Aave's TVL Hits $40.3 Billion, AAVE Token Surges 25%

Aave, a decentralized finance (DeFi) protocol, has reached a new record of funds onchain, with a total value locked (TVL) of $40.3 billion on May 12. This milestone was announced by Aave itself, with onchain data revealing that Aave v3, the latest version of the protocol, holds approximately $40 billion in TVL. Aave operates as a DeFi lending protocol, allowing users to borrow cryptocurrency by depositing other types of cryptocurrency as collateral, while lenders earn yield from borrowers.

The surge in TVL is indicative of Aave's growing dominance in the DeFi lending space. DeFi analyst Jonaso noted that Aave is proving its leadership in the sector. TVL represents the total value of cryptocurrency deposited into a protocol’s smart contracts, and Aave's recent achievement underscores its increasing popularity and trust among users.

Aave's previous all-time high TVL was reached in December, largely driven by a 60% increase in the price of Ether (ETH) from the prior month. Ether and its staking derivatives constitute nearly half of Aave’s TVL. This time, the new record is attributed to a significant influx of deposits from users, reflecting growing confidence in the protocol. In Ether-denominated terms, Aave’s TVL has risen from around 6 million ETH at the start of 2025 to nearly 10 million ETH on May 12, demonstrating the protocol's resilience and growth despite fluctuating cryptocurrency prices.

The price of Aave’s native AAVE token has also seen a notable increase, rising approximately 25% in the past seven days. This surge reflects the overall positive sentiment in the crypto market and the continuous inflow of TVL into Aave. The protocol's ability to attract and retain substantial deposits highlights its robust infrastructure and user-friendly features, positioning it as a leading player in the DeFi ecosystem.