World Liberty Financials’ investment of $5 million into AAVE, ETH, and LINK has elicited excitement in the DeFi space, leading to price surges and bullish on-chain metrics.
Attention in the DeFi space this week has been hijacked by the crypto venture of incoming United States President Donald Trump (World Liberty Financial, WLFI). The venture’s ever-growing treasury sees it diversify into crypto, investing over $5 million into three crypto assets —Ethereum (ETH), Chainlink (LINK), and AAVE.
According to the on-chain analytics platform Lookonchain, the venture’s acquisition comprised 2,631 ETH at $3,801 each, 41,335 LINK at $24.2, and 3,357 AAVE at $297.8. The move marks WLFI’s first investments in LINK and AAVE, signaling an expansion into these promising DeFi assets.
LINK’s price surged to a three-year high following the purchase, highlighting increasing investor confidence and interest in the ecosystem’s potential.
World Liberty Financial Eyes Portfolio Expansion
The community also voted to deploy the Aave v3 protocol. Initially, this protocol will support borrowing and lending for Ethereum (ETH), Wrapped Bitcoin (WBTC), and stablecoins like Tether (USDT) and USDC.
This new venture will allocate 7% of the circulating supply of WLFI tokens to AaveDAO. In turn, the DAO will earn 20% of the fees generated by this new network.
World Liberty Financial has invested in Chainlink for data accuracy and cross-chain interoperability. This continued investment in these DeFi projects is a clear indication that WLFI intends to strengthen its position within this sector further.
According to Nicolai Sondergaard, a research analyst at Nansen, this approach of backing core DeFi projects positions the venture for long-term success. Sondergaard added, “Chainlink will provide the interoperability infrastructure, and the project is launching on Aave v3, a protocol built on Ethereum.”
Impressive growth for WLFI’s portfolio
News of World Liberty Financial’s acquisition and the Aave v3 protocol launch led to price surges for LINK and AAVE. LINK has risen 23% in the last week, while AAVE has increased 44%. ETH itself has also been gaining momentum, reaching close to $4,000 at the time of writing, according to CoinGecko data.
According to blockchain intelligence service Arkham Intelligence, Ethereum alone comprises more than $50 million of World Liberty Financial’s portfolio. The remaining comprises wrapped Bitcoin (wBTC) and stable coins like USDC and USDT, all of which are valued at around $74 million.
AAVE On-Chain Metrics
Current CoinGecko data indicates that the price of AAVE has soared significantly over the week, trading above $350 on Friday. It is up nearly 28% for the week after climbing almost 80% in December alone.
Currently, the market capitalization of AAVE is at $5.33 billion, reflecting a larger interest and activity within its ecosystem. Recent on-chain indicators are, however, relatively bullish for the token.
According to DefiLlama, an independent DeFi analytics provider, the crypto asset’s total value locked (TVL) rose from $13.77 billion on November 1st to $23.46 billion on Friday. It last reached this high in November 2017 when it was launched, indicating strong user interaction and protocol adoption.
Another positive is the increase in the coin’s active addresses. Per Santiment, these addresses rose from 1,635 on Wednesday to 5,079 on Thursday. Moreover, its trading volume reached $2.36 billion on Thursday, the highest level since October 2021.
AAVE Price Analysis and Whale Activity
The technical indicators suggest that the coin’s price could still go higher. Following its breakthrough above the 50% retracement at $356.80, the 61.8% Fibonacci level at $430.24 could be the next target for its price.
If the rally extends, AAVE could test the psychological $500 price mark. The current RSI at 81 suggests overbought conditions and the possibility of a pullback.
Whale activity has also been a major catalyst for the crypto’s recent price surge. Consequently, it has outranked most of the top 50 cryptocurrencies in daily price performance.
By comparison, Bitcoin (BTC) rose only by 2.7%, Ethereum (ETH) by 5.66%, and Dogecoin (DOGE) by 1.86%. AAVE’s 27.7% surge in the last 7 days depicts that investor sentiment is bullish.
