The governance token of DeFi lender Aave bounced more than 2% early Wednesday above $220, reversing early losses amid a fresh community proposal for a $50 million token buyback initiative.
The move followed a volatile session that saw prices swing more than 10% within a $22.55 intraday range, with AAVE rebounding sharply from a session low of $214.25, CoinDesk Research’s analysis model showed. Alongside the price action, the token saw a 23.68% surge in trading volume compared to the weekly average. Despite the rebound, the token was still 5% down from Tuesday’s session high.
While the move reflected the broader crypto market modestly rebounding from overnight lows, it also coincided with a new governance proposal that could reshape AAVE’s long-term token economics.
The Aave Chan Initiative (ACI), led by Marc Zeller, proposed on Wednesday a permanent $50 million annual buyback program funded by the lending protocol’s revenue. The plan would extend Aave’s current buyback scheme and allow for adaptive weekly purchases between $250,000 and $1.75 million worth of AAVE, depending on market conditions.
Proponents said the program will create consistent buying pressure, recycle idle treasury assets and stabilize the token’s market dynamics. It marks a step toward institutionalizing “Aavenomics” as a core part of the protocol’s long-term economic model.
Technical analysis
Key technical levels signal consolidation for AAVE, CoinDesk Research’s model suggested. AAVE now faces near-term resistance at $236.80, with support holding between $215 and $220. Price action may stay range-bound unless governance momentum or macro trends shift demand further.
- Support/Resistance: Primary support holds at $215-217 zone with resistance at $236.80; new near-term support formed at $220 following volume surge.
- Volume Analysis: 24-hour volume climbed 23.68% above seven-day average with peak activity of 128,661 units at 22 October 11:00 representing 124% above 24-hour Simple Moving Average.
- Chart Patterns: Range-bound consolidation within $22.55 trading range (10.1% volatility) with dramatic intraday reversal from $214.25 session low.
- Targets & Risk/Reward: Immediate resistance at $236.80 level with support confluence around $215-220 zone providing defined risk parameters for position management.
Disclaimer: Parts of this article were generated with the assistance from AI tools and reviewed by our editorial team to ensure accuracy and adherence to our standards. For more information, see CoinDesk’s full AI Policy.