Standard Chartered has initiated coverage of decentralized lending protocol Aave, projecting its native AAVE token could surge to $3,500 by the end of 2030 from about $74 today, implying a potential 50-fold increase.
The forecast, issued by Geoffrey Kendrick, the bank’s global head of digital assets research, reflects a broader bullish outlook on decentralized finance, driven by expectations of rapid expansion in tokenized assets and stablecoins.
Long-term growth tied to DeFi expansion
The bank’s model assumes total decentralized finance assets will grow 37 times to approximately $2.7 trillion by 2030. This expansion is expected to be fueled by increasing adoption of tokenized real-world assets and stablecoins.
Standard Chartered outlined interim price targets for AAVE, with projections of $180 by 2026, $600 by 2027, $1,200 by 2028, and $2,200 by 2029. The report also expects AAVE to outperform both Ethereum and Bitcoin over this period.
Recovery underway after 2025 exploit
Aave is still recovering from the April 2025 KelpDAO bridge exploit, which significantly reduced activity on the platform. Deposits fell from $44 billion to $23 billion, while active loans dropped from $18 billion to $9.5 billion. Market share also declined sharply in both deposits and lending.
More recent data shows signs of recovery, with total value locked climbing back to $27.2 billion and $83.3 million in fees generated over the past 30 days. A governance proposal known as “Aave Will Win” now directs protocol-generated revenue into the DAO treasury, aiming to better align growth with the ecosystem.
Revenue model and token mechanics
Kendrick described Aave’s business model as straightforward, where deposits drive lending activity and lending generates fees. Around 90% of fees come from interest margins. Of that, roughly 15% goes to the protocol, while the remaining 85% is distributed to liquidity providers.
The report incorporates Aave’s token buyback program into its valuation, despite it being paused after the 2025 exploit. Prior to the pause, about 205,000 tokens, or 1.3% of total supply, had been repurchased.
Technical upgrades and migration challenges
Aave V4, launched in March, introduces a hub-and-spoke architecture designed to reduce bridge-related risks. However, adoption remains limited so far, with 99.4% of deposits still on version 3 and only 0.4% migrated to V4.
The upcoming Ethereum Economic Zone integration is expected to improve liquidity sharing across layer-2 networks, potentially strengthening Aave’s infrastructure.
Expansion into tokenized assets and stablecoins
Aave’s Horizon platform, launched in August 2025, focuses on permissioned lending for tokenized assets and currently holds $163 million in active loans. The broader tokenized real-world asset market has expanded to more than $51 billion, reflecting growing interest in blockchain-based representations of traditional assets.
Meanwhile, Aave’s GHO stablecoin has reached about $600 million in circulation. All fees from GHO flow directly to the protocol, unlike its broader lending operations. Stablecoin supply overall is projected to grow from $310 billion to nearly $2 trillion by 2028, a key driver for DeFi lending growth in Standard Chartered’s outlook.
Regulatory and structural factors ahead
Further growth into traditional finance will depend on regulatory clarity, particularly in the United States. Proposals such as the Clarity Act are seen as potential catalysts for institutional participation in tokenized markets.
Founder Stani Kulechov has also pointed to a new risk framework under internal review, following lessons from the 2025 exploit.
Mixed near-term outlook despite bullish forecast
Despite improving fundamentals, AAVE remains down more than 88% from its all-time high, reflecting the broader decline in DeFi valuations since 2022.
From a technical perspective, the token recently faced resistance near $78 after rebounding 34% from early June lows. Analysts note that a breakout above the $85 to $90 range would be needed to shift the current bearish trend. Failure to clear this level could lead to a move back toward support near $50.
While Standard Chartered’s long-term projection is aggressive, other estimates are more conservative. A separate analysis from Grayscale suggests a nearer-term fair value around $175, contingent on faster adoption of tokenized assets and successful execution of Aave’s upgrade roadmap.
For deeper insight into Aave, DeFi and TradFi convergence, explore our guide on TradFi vs DeFi dynamics today.
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