Aave’s DeFi Lending Market Share Surpasses 50% for the First Time Since 2020

The market capitalization of decentralized finance (DeFi) in February fell to its lowest level since May 2025.

According to DeFiLlama, on February 6, the value of digital assets blocked in DeFi projects (TVL) fell to $95.084 billion.

Last fall, TVL exceeded $145 billion. The decline began in December, but the pace of capital outflow from the protocols accelerated at the end of last month.

Source: DeFiLlama

In the ranking of protocols in the first place is Aave with a capitalization of $27.68 billion. This project is based on 18 blockchains and dominates the DeFi lending market.

For the first time since 2020, Aave’s share in the borrowing market exceeded 50%.

In 2019-2020, this sector was controlled by the Compound Finance protocol, but already during the Covid-19 pandemic, its share fell sharply, and the scale of lending through Aave, on the contrary, began to grow rapidly.

Source: MEXC

The basic digital asset of the project – the AAVE token is trading at a minimum level since the fall of 2024.

The remaining coins in DeFi projects also faced pressure amid a redistribution of capital in favor of precious metals and commodities.

The main theses:

• DeFi tokens are retreating along with bitcoin and the rest of cryptocurrencies.

• Capital is exiting the sector as decentralized finance protocols are still seen as risky instruments.

• Investors are ready to return to DeFi projects if the situation in the stock markets improves.

• One of the most promising areas in the sector remains lending.

• For the first time since 2020, more than half of the capital used in borrowing is distributed within the Aave ecosystem.

The growth of the stock balance of AAVE may signal the preparation of traders for a new reset

The AAVE stock balance this week reached a monthly high. According to CryptoQuant, the volume of tokens on trading floors has been increasing since January 31.

Traders send cryptocurrency to exchange addresses, which is usually seen as preparation for a new reset.

Source: CryptoQuant

The situation in the market in the middle of the week stabilized, and so far bitcoin manages to stay above $60,000. But the risks of drawdown persist if capital leaves the shares of IT companies and again rushes into precious metals.

Source: MEXC

On the MEXC exchange on February 6, the AAVE rate fell below 95 USDT. The local bottom was fixed at 92.46 USDT, but in the afternoon the coin was able to bounce back to 103.21 USDT.

The average daily trading volume of AAVE on MEXC is $42.57 million. The pressure can increase at any time, despite the fact that in January the token was on the list of one of the most productive altcoins.

According to Santiment, in the first half of last month, AAVE was among the leaders in profitability (+ 11%) amid a jump in bitcoin above $90,000. But in the second half of January, the DeFi token began to retreat.

Source: Santiment

first blow to the project caused a conflict between the community and developers. As a result, the capitalization of the altcoin fell by $500 million, but the coin suffered the most loss at the turn of January-February.

Whale addresses, controlling approximately 80% of AAVE turnover, during the conflict between ecosystem users took advantage of the 20% drop in the asset to $143 and purchased 12.92 million tokens, which is about 8% of AAVE turnover (according to Nansen).

Source: Nansen

Last year, the number of large and medium-sized token holders increased by 66%. Retail traders, on the contrary, mainly sold AAVE in January, so the volume of cryptocurrency in whale and shark wallets increased sharply. This is indicated by the increase in the number of addresses with a balance of at least $1 million in AAVE.

• Pressing intensified at the end of January. Whale wallets were the first to aggressively sell, then medium and small addresses joined them.

If at the beginning of 2026 in the expert environment, many were guided by the bullish scenario and expected the token to rise by 30% to $210-220, now analysts allow a drawdown below $90 in the coming days if support does not return, and the whales do not resume purchases.

Key findings:

• DeFi protocol Aave controls more than half of the lending market in the decentralized finance sector, but its underlying digital asset has suffered heavy losses in recent days.

• The coin fell below $100, and there were risks of AAVE drawdown below $90 amid the transition of whales and sharks to asset sales. The situation stabilized in the second half of this week.

• If the pressure does not increase in the coming days, then AAVE, along with the rest of the cryptocurrencies, will enter the consolidation phase, which may be delayed, the MEXC Research team notes.

Investors invested $550 million in Donald Trump s crypto project, but cannot sell tokens

In September 2025, during the election campaign in the United States, the team of presidential candidate Donald Trump launched the World Liberty Financial crypto project, the basic digital asset of which was the WLFI token.

It is available on the MEXC exchange and is now trading at $0.108. The coin, as a result of the January fall in the crypto market, dropped to its lowest level since its launch in September last year.

Source: MEXC

The MEXC Research team recalls that last fall WLFI reached $0.33 – this mark was a record for a token that was quickly adopted by investors in the decentralized finance market (DeFi).

The total investment was approximately $550 million. Investors who purchased tokens were confident that they were buying one of the most promising digital assets.

• The average purchase price between October and January ranged from $0.015 to $0.05.

However, the crypto project of Donald Trump’s team was under the control of his sons Eric and Barron. Only they decide who has the right to sell tokens.

Source: MEXC

The vote, which should determine the further fate of the token, has not yet taken place. Now WLFI holders cannot sell a cryptocurrency that loses in value.

• Over the past five months, the DeFi token has fallen 54%, and almost 80% of the supply is still locked. Investors still don’t know when they will be able to access the coins and sell them.

Among those who purchased tokens, but could not implement them, was the leader the creator of Tron Justin Sun. He invested $75 million in the project, but his funds are still frozen, and their value is declining.

Key findings:

• The hype around the WLFI coin ended with strong investor disappointment.

• They invested $550 million in the asset, but 80% of the cryptocurrency is still blocked. Token holders do not even know the approximate timing of unlocking WLFI.

• Such uncertainty threatens not only a specific project, but also requires measures to create a regulatory framework to regulate transactions in DeFi protocols.

Conclusion

• DeFi protocol Aave remains dominant in the lending market in the decentralized finance sector. This project retains its leading position despite the fact that its underlying digital asset AAVE token is trading at its lowest level since last fall.

• The DeFi market in January-February faced an outflow of capital. Investors withdraw funds not only from bitcoin and second and third-tier altcoins, but also seek to reduce their presence in tokens placed in decentralized financing projects.

• In the context of the decline in the value of digital currencies, the problem of traders’ access to blocked tokens has intensified.

• One striking example was Donald Trump’s crypto project, launched in September. Almost 80% of WLFI coins are frozen, and their buyers cannot access them.

• The vote that should decide the fate of the WLFI has not yet taken place, and such uncertainty causes dissatisfaction among investors, the MEXC Research team notes.

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