With the predominance of 13 whales, is AAVE a risky investment right now?

Looking at AAVE, it appears that the DeFi token is in a better position right now, given the 15% rally that has taken place over the past 24 hours. The bigger picture, however, is much less exciting.


Usually, when a token or an altcoin is strongly associated with whales, it is considered a risky investment due to the fear of unprecedented dumplings.

However, certain tokens like Polygon (MATIC), Chainlink (LINK) and in this case also AAVE have surprisingly stable whales. This is why these tokens have become one of the best cryptocurrencies in the world.

Notably, AAVE has the dominance of 13 whales, which together account for 66% of the 16 million AAVE stock. While they have their hands on most of the offerings, most of this offering has been untouched for a while.

AAVE Whales dominate 66% supply | Source: Intotheblock – Coin-Crypto

Addresses and balance divided by their duration show us that AAVE witnessed the rise of HODLers (long-term holders) in October. These investors have been holding onto their AAVE for over a year now. In addition, these HODLers currently account for 32.78% (34.2k) of all addresses.

The number of AAVE HODLers is increasing | Source: Intotheblock – Coin-Crypto

These 34.2k addresses total about 3.87 million AAVE, which has been in the wallets of these investors for over a year now. But the question is can this last?

HODL all the way

In addition to the 3.87 million AAVE that has been held for more than 1 year, there is another 10.94 million AAVE between a month and a year.

ITB data shows that of the 103k total addresses with AAVE, 82.8% of them are currently lost. While it may seem that current market conditions are responsible for this, in reality this has been a developmental situation, not overnight.

AAVE investors in loss | Source: Intotheblock – Coin-Crypto

At the beginning of May 2021, the concentration of investors in earnings began to fall from 94% and has not stopped yet.

This means that the AAVE holders who have held the token for a month and over a year have seen AAVE peak at $629. However, they are currently witnessing the altcoin’s struggle to break through $140.

The only reason most of these HODLers are still HODLing is that the price drop still hasn’t wiped out the entire 2021 surge. AAVE is still 66.38% above its January 2021 level and as long as it stays that way, these investors will have no intention of exiting.

AAVE price promotion | Source: TradingView – Coin-Crypto

It is interesting to note that a nudge from investors could even help AAVE recover, provided broader market indications turn bullish.

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