AAVE's price is facing renewed downward pressure as a key governance participant, Aave Chan Initiative (ACI), announced its departure from the Aave DAO. ACI was previously the most important delegate and service provider in the ecosystem, and its decision stems from governance disagreements with Aave Labs over the flow of funds.
The controversy originated last December when Aave Labs transferred approximately $5.5 million in swap fee revenue to a company-controlled wallet instead of injecting it into the DAO treasury. ACI viewed this move as a departure from decentralized principles, ultimately prompting the organization to fully withdraw after its contract expires on April 1st. ACI founder Marc Zeller stated that he will continue to participate in the ecosystem as an independent service provider in the future, but will no longer be directly involved in DAO governance decisions.
This change has heightened market concerns about the transparency and decentralization of the Aave project's governance. At the same time, on-chain data also shows weakness: network weekly revenue has plummeted from $4.31 million in early February to $1.62 million, a decrease of 62%, reflecting a significant decline in protocol usage activity, which may further weaken investor confidence.
From a technical perspective, the AAVE daily chart has been running within a clear descending parallel channel since August of last year, and the price has consistently failed to break through the upper rail resistance of approximately $120. This pattern is a typical bearish continuation pattern, indicating that the bears still dominate. The Aroon indicator shows the downward line at 71%, while the upward line is at 0%, confirming strong selling pressure; the MACD indicator also remains below the zero axis, with no reversal signal.
If the bulls are unable to hold the current price support, AAVE risks retesting the April 2024 low of approximately $70. Conversely, if the price can effectively break through the $120 channel upper rail, it may trigger a medium-term trend reversal, attracting a new round of buying.
AAVE Price Under Pressure as Key Governance Participant Exits, Sparking Market Concerns
Aave Chan Initiative's exit from Aave DAO governance, due to funding allocation disputes, raises market concerns about the project's decentralization. Plummeting on-chain revenue and persistent technical pressure put AAVE price at risk of testing $70.