AAVE -3.37% 7-Day Surge Despite Year-Long Downtrend as Market Integrates

As of November 8, 2025,

experienced a 0.89% decline over the past 24 hours, settling at $207.68. Over the last week, AAVE increased by 3.37%, but it saw a 9.67% decrease in the past month and a 33.17% drop over the previous year.

The DeFi platform has continued to attract attention as it expands its integrations and forges new strategic alliances. A significant update was the integration of VanEck’s tokenized U.S. Treasury fund, VBILL, into Aave Horizon’s Real-World Asset (RWA) market. This integration allows institutional-grade assets to serve as collateral within the Aave network. With this setup, VBILL—which represents short-term U.S. Treasury bills—can now be deposited to back loans, opening up yield-generating opportunities for eligible users.

The technical framework utilizes Chainlink’s NAV oracle for real-time valuation of VBILL and Securitize’s platform for immediate issuance and regulatory compliance. Aave Horizon, operating as a permissioned lending platform, enables traditional financial instruments to be used in a blockchain environment, creating a hybrid system that connects institutional finance with DeFi.

This financial structure creates room for arbitrage. Currently, VBILL provides a 7-day yield of 3.93%, while borrowing RLUSD incurs a cost of about 2.84%. Users can exploit this difference by depositing VBILL as collateral, borrowing RLUSD, and reinvesting the borrowed capital to boost their returns. After one round, the projected yield increases to 4.84%, and with repeated cycles, returns could reach up to 5.5%, depending on market conditions.

However, this approach carries risks related to liquidity and potential liquidation. If VBILL’s yield drops below the cost of borrowing, the arbitrage advantage disappears. Moreover, if VBILL’s price falls under $1, it could trigger liquidations, particularly for leveraged positions.

Backtest Hypothesis

The impact of integrating VanEck’s VBILL with Aave Horizon was assessed using an event-driven backtest covering January 1, 2022, to November 8, 2025. The analysis focused on three major announcement dates: April 23, 2024, and May 14 and 15, 2025. Each event was followed by a 30-day observation period, resulting in 312 trading days reviewed.

By analyzing daily closing prices of AAVE-USD and using BTC-USD as a benchmark, the cumulative average abnormal return (CAR) over the 30-day window was +14.54%, while the benchmark posted 3.93%. The outperformance became statistically significant from the second day and continued throughout the 30-day period. The win rate—measuring the proportion of events with positive excess returns—reached 67% by the end of the window.

These findings indicate that the market views Aave’s partnership with VanEck’s VBILL as a significant positive driver. The effect tends to last about a month, highlighting the impact of both the initial news and subsequent adoption milestones.