AAVE price slid more than 15% in four days but buyers quickly scooped the dip, setting up a potential 20% leg up as Pendle’s booming tokenized yield markets drive renewed interest in the Aave protocol.

Aave aave-6.73%Aave price dipped over 15% in just four days, from $283 peak on May 27 to $240 intraday low today. However, buyers rushed to scoop the dip, driving AAVE price above $254 intraday peak though it has since retraced slightly to $251.
The rebound comes amid a period of heightened activity on the Aave protocol, particularly related to the growth of tokenized yield markets in collaboration with Pendle (PENDL) and Ethena (ENA).
On May 27, support for three new collateral types—eUSDe, July-maturity PT-USDe, and August-maturity PT-eUSDe—was added to Aave, bringing an aggregate initial market size of approximately $700 million. The following day, on May 28, Pendle launched two of these markets with supply caps of $100 million for PT-eUSDe and $40 million for PT-USDe. Both caps were fully filled within hours, prompting Pendle to raise the limits on May 29 to $200 million and $80 million, respectively. These higher caps were again filled rapidly, reflecting strong demand for tokenized yield instruments on Aave.