Whales buy an additional $3 million worth of AAVE as governance uncertainty puts pressure on the price.

The price of AAVE is under constant pressure. The Token has fallen nearly 5% in the last 24 hours and over 18% in the last seven days. This weakness occurs as disputes over DAO governance continue and fears of a sell-off return.

On the surface, this looks like a distribution phase. The balance on the exchange is increasing, and market sentiment has calmed down. But a closer look reveals something amiss. Despite the supply shifting to the exchange, large investors are quietly buying, XEM price drops as an opportunity to enter rather than exit. The question is clear: What positive outcome are these large investors expecting when the entire market is focused solely on governance risks?

Supply on the exchange increased as governance pressure persisted.

The AAVE sell-off was not unexpected. Governance tensions had been building for weeks , creating uncertainty about revenue streams and control of the DAO. This was clearly reflected in the on-chain supply figures.

Since December 16, 2023 (the date of the Poison Pill proposal), the supply of AAVE on exchanges has increased from approximately 1.22 million Token to approximately 1.42 million Token. This represents an increase of nearly 200,000 AAVE, equivalent to about 16%, in just over a week.

An increase in balances on the exchange is often a sign that selling pressure may increase, and the price movement reflected this accurately, with AAVE falling nearly 18% during the same period.

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This shift is noteworthy because it contrasts with what happened earlier this month, on December 16, 2023. When legal concerns surrounding AAVE eased in mid-December , the balance on the exchange fell sharply due to improved market sentiment. But now, with governance issues persisting, supply is returning to the exchange, further increasing short-term caution.

From this perspective alone, the situation doesn't seem optimistic. But the supply on the exchange only reflects one side of the market.

Whales buy as sell-off fears peak.

Despite the increase in balances on the exchange, large holder are acting in the opposite direction.

Over the past 24 hours, AAVE whales have increased their holdings by 12.63%, bringing the total to 183,987 AAVE. This means they purchased approximately 20,600 additional Token, worth around $3.1 million at current prices.

Simultaneously, prominent wallets, including validated funds and large institutions, also increased their holdings by 13.55%, reaching 274,652 AAVE. This represents an increase of approximately 32,700 Token, equivalent to $5 million.

In total, in just one day, these two groups purchased over 53,000 additional AAVE. At the current price, these Token are worth over $8 million, accumulated during a weak market.

This counter-trend is significant. When supply on the exchange increases but whales are buying, it often indicates that short-term fear is being absorbed by long-term confidence. Instead of reacting to governance noise , large holder seem to be focusing on market structure, rather than just attention-grabbing news.

That leads us to analyze the price chart.

What are the factors driving up AAVE 's price that the whales are preparing?

Price volatility is the final missing Shard of the puzzle.

AAVE has repeatedly defended the $147 price level , forming the "head" of an inverse Vai-and- Vai pattern. This Capital typically signals a potential trend reversal after a prolonged downtrend, especially when it occurs during periods of high investor anxiety.

The current pattern remains compressed below the descending neckline, indicating that sellers are still in control of the overall trend. However, the clear signal is that if the price breaks above $182, momentum will begin to shift upwards. Breaking above $193 would confirm the breakout and open up the potential for further gains towards $207, then $232, with a larger recovery target at $248.

The risks have also been clearly identified. If AAVE falls below $147, the bullish pattern will be broken. Selling pressure could then intensify, with the next support zone at $127. Currently, whales are betting that this support zone will hold, and the price structure will rebound more positively.