AAVE Price Struggles Below $100 Amid Heavy Liquidations

A Key DeFi Lending Protocol Faces Challenges

AAVE, a key DeFi lending protocol, has been struggling to stay above the $100 mark amid heavy liquidations. The protocol's native token, AAVE, has lost over 30% of its value in the past week, and is currently trading at around $95.

Liquidations Surge

The recent price decline has been driven by a surge in liquidations on the AAVE protocol. Liquidations occur when a borrower's health factor, a measure of their collateralization, falls below 1. This triggers the automatic sale of the borrower's collateral, which can further drive down the price of AAVE.

The recent liquidations have been caused by a combination of factors, including the recent volatility in the cryptocurrency market and the increasing use of AAVE for leveraged trading. As the price of AAVE has fallen, more borrowers have been forced to liquidate their positions, creating a negative feedback loop.

Conclusion

The AAVE price is currently struggling to stay above $100 amid heavy liquidations. The protocol's native token has lost over 30% of its value in the past week, and it is unclear when or if it will recover. The recent liquidations have raised concerns about the health of the AAVE protocol, and it remains to be seen how the project will weather the current storm.