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Aave (AAVE) price closed over 75% higher last week in one of the more impressive performances from an altcoin in recent months. The surge in price came after massive declines that DeFi coins suffered since August. 

DeFi has experienced a major boom in 2020. A number of DeFi tokens saw massive adoption this year in the crypto community, thanks to smart contract technology and yield farming that allows the users of these tokens to gain extraordinary interest in their crypto assets. 

The founder of Binance exchange, Changpeng Zhao, notes that the DeFi market is flooded with all types of lending protocols that compete with each other by allowing consumers to yield swift returns. 

“Today’s most promising DeFi apps all share a similar vision for the future: The creation of a divergent financial system where capital and data flows more equitably, shifting control away from institutions and towards the individual,” he wrote in a blog post. 

Some protocols even promote double or triple-digit interest rates, as opposed to 0.5% interest rates seen on the “high-yield” traditional savings accounts. Even though some of these protocols are still unsustainable, their massive emergence has certainly initiated a big hype.

Zhao says that even the most commonly used DeFi apps are still overshadowed by centralized exchanges which still have the largest influence over the crypto space. These centralized exchanges provide users with a persuasive set of services that are more user-friendly.

On the other hand, decentralized finance is battling with trust issues that it has to overcome in order to win mass adoption. When it comes to financial assets, consumers look at three primary things – liquidity, security, and stability. 

These three aspects are what help win trust among crypto users. While DeFi protocols are still hard to understand and access for some users, centralized finance platforms are easier to access and have become multi-dimensional over recent years. However, it appears that the DeFi space is close to reaching a turning point when it comes to adoption. 

The attraction of financial self-custody and decentralization is key to the initial aim of blockchain technology as it has the ability to provide unprecedented freedom of money for all participants and create historical opportunities for its users. Therefore, it is very likely that the DeFi represents the future of crypto. 

After a massive correction that took place in nearly all DeFi-focused altcoins, the return of DeFi bulls has pushed AAVE price much higher. Last week’s gains of over 75% have single-handedly erased all losses from October. 

This way, the bulls returned about 50% of the territory lost during the August – October correction. They are now likely to target a push towards the key 61.8% retracement that sits just above the $65 mark.

Whereas centralized exchanges still have a major influence over the crypto space due to its user-friendly number of services, the future of crypto is likely to fall in hands of decentralized finance, writes Binance’s CZ. In the meantime, AAVE stock price surged over 75% last week as the DeFi bulls announced their return in a big fashion.

The post Aave (AAVE) price gained 75% last week, eyes $65 next appeared first on Invezz.

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