Internal governance tensions push AAVE lower despite insider buying and broader market stability.
Aave has recorded a sharp downturn, with the AAVE token falling nearly 19% over the past week, underperforming most major cryptocurrencies. The decline has pushed price into a critical demand zone, reflecting heightened selling pressure that intensified as a contentious governance proposal advanced to a Snapshot vote.
The primary catalyst behind the sell-off appears to be a governance dispute related to control over Aave’s brand and public communication channels. As the proposal gained visibility, uncertainty around protocol leadership and long-term direction began to affect investor confidence. Governance-related risk often has an outsized impact on decentralized finance tokens, and Aave has been no exception.
Market participants tend to price in uncertainty quickly when protocol governance is questioned.
Despite the negative momentum, Aave founder Stani Kulechov reportedly purchased approximately $12.6 million worth of AAVE, signaling internal confidence in the protocol’s long-term value. However, this move has not been sufficient to offset broader market selling.
Insider accumulation alone has not yet shifted overall market sentiment.
From a price-structure perspective, AAVE has broken below several intermediate support levels, accelerating the downside move. The token is now trading near a weekly low, where buyers may attempt to defend the zone. Failure to hold this level could expose price to further downside volatility.
Until clarity emerges around governance outcomes, AAVE may continue to lag the broader market. A sustained recovery will likely depend on resolution of internal disputes and a reclaim of key resistance levels, rather than short-term buying activity alone.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.