Aave | The Number One Lending Protocol! Data On TVL, Deposits, Borrows, Users | March 2023
Aave is now one of the few defi protocols that has proven itself throughout the years. The market went up and down, but the protocol kept on going. The TVL even under these bad conditions is still in the billions. No hacks and failures on the platform up to date.
It is now by far the number one borrow and lending protocol.
Let’s take a look.
Aave works in simple way at first sight. Users deposit (supply) collateral in some of the tokens that are accepted on the platform and borrow against that collateral, another assets/tokens that are listed.
A classic example would be deposit BTC as collateral, borrow some stablecoin, as example USDT.
The main thing to look out for is the health factor or the supply to borrow ratio and avoid liquidation. By design the protocol have limits and it wont allow you to borrow more than 70% of the value of the assets you have supplied. But this being crypto you want to be much safer than that and go in the range of 10% to 30% loan to collateral value. This means a 10k collateral for 1k to 3k loan. Managing this ratio is at the end of the day an individual decision, but just have in mind the overall rules.
More to read on Aave on the docs link.
Here we will be looking at:
- Total value locked
- Deposits volume
- Defi protocols rank by TVL
- Number of users DAUs
- Top Pairs
- V2 VS V3 Volume
The period that we will be looking at is 2022 - 2023.
The data here is compiled from different sources like DefiLama, Dune Analytics and Messari.
Total Value Locked
Here is the chart for the TVL on AAVE.
A significant drop in the TVL on AAVE in 2022, from 14B to 4B at the end of the year. The biggest drop happened in May and June where on two occasions there was a drop in the TVL by four millions. These drops are mostly because of the drop in price in the overall crypto market.
At the beginning of 2023 we have seen a slight recovery up to 5B where we are now.
Unlike the swaps and trading platforms, there is no active trading on Aave, but still there are deposits, borrows, liquidations etc. Here we will be looking at the deposits as there is where the most volume is. Going forward will look a bit more in borrows, withdrawals etc.
The chart looks like this.
We can see and overall downtrend in the daily deposits.
At the beginning of 2022, there was more than 400M deposits happening daily. At the end of the year these were averaging around 50M per day. In 2023 the deposits volume kept the pace from the end of 2022, and it is still around 50M per day.
Top Defi Protocols Ranked By TVL
How is the Aave protocol doing when compared to the other ones? The total value locked is usually one of the metrics these protocols use.
Here is the chart.
Aave comes as no.4 protocol in terms of TVL. The Lido protocol, that is the no.1 on the chart with 9B in TVL is a bit specific. It is used for ETH staking, and it has only staked ETH in it. MakerDAO on the second spot is used to generate the DAI stablecoin.
Curve comes next, and it is in a close race with Aave.
Top Supplied And Borrowed Assets On Aave
What are the assets that have the biggest supply on Aave?
Here is the chart.
Aave has a V2 and V3 versions, and both are represented on the chart above.
As we can see Ethereum is the number one asset that is supplied on Aave, in both of his forms, liquid and staked. This is probably to a no surprise because Aave is build on Ethereum.
The USDC stablecoin comes next, and then WBTC. More other stablecoins in the top rank as Tether, DAI etc.
What about the top assets that are borrowed?
Here is the chart.
ETH comes on top here as well followed by USDC and the others stablecoins USDT and DAI. Bitcoin is a bit down compared to the supply side.
The borrow to supply ratio for the different assets looks like this:
The most borrowed asset in relative terms are the stablecoins. USDT comes on top, followed by DAI and USDC. This is to no surprise because it follows the logic that in the long term, stablecoins will loose value against the other crypto assets, especially against BTC and ETH. Interesting ETH is also in the top with a 51% ratio.
V2 VS V3
The asset allocation between the two versions looks like this:
The V2 is obviously still leading by lot. A 92% of the assets are supplied there. The transition from one to another version is not that fast when it comes to landing platforms. Users have their collateral locked and it takes time for more significant funds to be moved.
How many users Aave has? Here is the chart.
Not as much as some of the others apps, somewhere in the range of 500 to 1000 users per day. On some occasions there has been spikes with the number of active users going up to 2k per day.
These goes to show that most of Aave users play with larger amounts and don’t change their positions on a daily basis. It’s a long-term game when you borrow or lend.
The all-time chart for the AAVE price looks like this.
An overall downtrend in 2022, following the crypto market. The year started with the token price around 250 and ended with 50. There has been a recent spike in the price up to 90, and we are now back somewhere around 78. While the price of the token has taken a beating, it still managed to kept its value and the protocol is now ranked in the top 50 on the overall crypto market cap.
An overall drop in the TVL in Aave in 2022. As the market went down so does the TVL. Aave now comes as the fourth protocol in TVL in a close range with Curve. ETH and stablecoins are dominating the platform both on the supply and borrow side. BTC is also in the top. Most of the liquidity is still on V2. There is around 900 DAUs. The price has been hovering in the range of $50 to $100 since July 2022.
All the best
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This is really great then.. wow.
I'll read more about it and know more... I am just seeing it for the first time
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I'm thinking about borrowing some
Interesting and is one crypto project I have never really looked at. Wondered why the price was so high yet it isn't really considering where it once was and will most likely return surpassing the ATH at some point. I need to check the APR on offer for staking as earning a decent return knowing the price will go up is the bonus.
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Aave is no doubt an amazing defi Platform, it is also very famous in the gamers. Glad to see it is standing and still delivering in the bear market. It will shine more when the right time comes @dalz
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