Aave founder Stani Kulechov has floated burning AAVE tokens bought back through the protocol's buyback program, a move that surfaced as the protocol crossed $3 billion in cumulative revenue. The proposal lands alongside a $4.26 million whale purchase of AAVE, even as exchange reserves of the token climbed 6.26% in 24 hours.
Aave founder Stani Kulechov floated burning AAVE tokens that the protocol had already bought back from the market. The idea surfaced as Aave Protocol crossed $3 billion in cumulative revenue.
Under the existing model, protocol revenue funds AAVE purchases that stay inside the DAO rather than leaving circulation permanently. A token burn would change that, turning the buyback into a permanent supply-reduction mechanism and reshaping how Aave directs its revenue toward the native token.
Whale demand joins the buyback story
As the burn discussion spread, large holders added to their AAVE positions. Reportedly, two wallets swapped 50.95 WBTC, worth nearly $4.26 million, for 25,502 AAVE, layering direct market demand on top of the protocol-driven purchases.
The whale activity signals that large participants committed considerable capital to AAVE during the period, tying whale accumulation and the buyback mechanism into the same supply narrative.
Rising reserves complicate the picture
Exchange reserve data, however, cuts against the tightening supply story. According to CryptoQuant, Exchange Reserve USD expanded 6.26%, reaching roughly $440 million over 24 hours, meaning more AAVE-denominated value moved onto exchanges.
That expansion creates conflicting signals: demand strengthened through whale buying, yet more capital now sits positioned on exchanges, where greater availability could invite additional selling pressure if holders decide to distribute.
Can buyers clear the $165.98 barrier?
On the 24-hour chart, AAVE rallied before meeting resistance near $165.98, where sellers interrupted the advance. The token then retraced to $161.93 at reporting time.
The broader structure still favors buyers: AAVE continues trading above its rising trendline, with the $141.48 level standing as key support below price. The Directional Movement Index also turned favorable after the rejection, printing +DI at 37.16 against -DI at 12.65. The ADX reached 34.27, confirming the directional move has meaningful strength.
AAVE could challenge the $180 area if buyers reclaim the $165.98 resistance. A continued rejection, though, could trigger a deeper retracement toward the trendline support.
Source: AMBCrypto
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