- Two whales bought ~$7.5M in AAVE with leveraged loans on June 6, per Lookonchain.
- Aave launched “Umbrella,” a new risk-management system to replace its Safety Module.
- AAVE price dropped ~5% to ~$250, testing critical Bollinger Band support near $255.
According to on-chain tracker Lookonchain, two high-profile whales collectively purchased 29,739 AAVE tokens worth approximately $7.5 million on June 6.
One wallet (0x372c) reportedly borrowed $5 million in USDC to pick up 19,608 AAVE. This move brought its total holdings to a staggering 280,673 AAVE, valued at $69.44 million. Meanwhile, another wallet (0xeBb4) borrowed $2.5 million in Aave’s native stablecoin, GHO, to buy 10,131 AAVE. That whale’s total holdings now stand at 120,513 AAVE, worth about $29.8 million.
These large, leveraged purchases, which use loans from decentralized stablecoins, suggest that these institutional-level or highly confident players are positioning themselves for a medium- to long-term bullish run on AAVE. This activity could be in anticipation of positive structural changes within the protocol.
Aave Launches “Umbrella”: A New Risk-Management System
And a major structural change has just arrived. Aave has officially rolled out “Umbrella,” a groundbreaking new risk-management system. It’s designed to replace the protocol’s aging Safety Module. Developed by BGD Labs and officially ratified by Aave governance, Umbrella introduces a new way to protect the protocol from bad debt.
It allows users to stake interest-bearing aTokens (like aUSDC, aWETH, and GHO) to provide real-time, automated coverage against any potential protocol shortfalls.
Now, the key difference from the old system is that Umbrella operates automatically. The prior Safety Module depended on Aave governance votes and the potential slashing of collateral from the AAVE token itself. With Umbrella, staked assets can be burned immediately if needed to cover a deficit.
Related: TRON’s JST Token Set for Explosive Growth: Is It the Next AAVE or MKR?
This allows for much faster resolution while still preserving lending yields for users providing the assets. For those staking their aTokens, the incentive comes in the form of dual rewards: they earn the base interest from the lending pool and also receive additional rewards in either AAVE or GHO tokens. This does, however, come with the risk of those specific staked assets being slashed during a deficit event.
AAVE Price Under Pressure, Tests Critical Bollinger Band Support
Interestingly, this bullish fundamental news comes as the AAVE price is currently testing a critical support level. A look at the daily chart shows the price has dropped to test the middle band of the Bollinger Bands (BB), which sits at $255.49 and often acts as a dynamic support line. The lower Bollinger Band is currently at $235.31.
This suggests a potential further 6% downside for AAVE if the middle-band support breaks. At the time of writing, AAVE trades around $250.50, marking a nearly 5% drop in the past 24 hours.
Related: Aave Price Prediction for May 21: Will the Rally Hold Above $265 or Is a Correction Coming?
Relative Strength Index (RSI) has dipped to 54.12, down from a recent high of over 62. This cooling RSI signals fading bullish momentum, though it remains above the oversold threshold (30), suggesting no immediate panic.
If AAVE can hold above this middle Bollinger Band and its RSI stabilizes, a bounce toward the upper band at $275.66 is possible. But, on the other hand, a breakdown below this mid-band support could send AAVE’s price down toward the $235–$240 range.
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