AAVE drops 1.47% amid Aave’s overhaul of its multichain approach

AAVE Declines 1.47% as Aave Refines Multichain Approach

On December 4, 2025, Aave (AAVE) saw its price fall by 1.47% over a 24-hour period, settling at $195.13. Despite this recent dip, the token has demonstrated strength, climbing 7.08% over the past week and 9.86% in the last month. However, looking at the bigger picture, AAVE has dropped 36.87% over the past year, mirroring the volatility and shifting risk appetite within the DeFi sector.

Aave Unveils Major Multichain Strategy Overhaul

Aave, a prominent decentralized lending platform, has revealed plans to overhaul its multichain expansion strategy. The Aave DAO is currently evaluating a governance proposal that would scale back the protocol’s presence on blockchains that contribute little to its revenue. This initiative is designed to concentrate Aave’s efforts and resources on high-performing networks such as Ethereum, Arbitrum, and Polygon, where user activity and revenue generation are strongest.

The proposal recommends winding down support for less active networks, including zkSync, Metis, and Soneium. Collectively, these chains bring in between $3,000 and $50,000 per year, a stark contrast to the $142 million generated annually by Aave’s deployment on Ethereum’s mainnet. This disparity highlights the need for a more focused approach within the ecosystem.

This strategic shift is motivated by the desire to boost capital efficiency, lower operational complexity, and strengthen risk controls. Dispersing liquidity across numerous blockchains has resulted in fragmented markets and thinner order books, which in turn increases the workload for both developers and auditors.

Impact on the Aave Ecosystem

By consolidating assets and activity onto its primary networks, Aave aims to deepen liquidity, stabilize price movements, and generate higher fees for liquidity providers. The proposal also suggests updating reserve factors and risk settings for markets that underperform, ensuring that only those with proven, sustainable revenue remain a priority.

This realignment is expected to create a more reliable and efficient environment for both borrowers and lenders, with narrower spreads and more predictable interest rates. Developers and aggregators will also benefit from a clearer, more stable foundation for building integrations.

Additionally, the proposal introduces stricter criteria for future expansions—any new blockchain integration will need to demonstrate significant user interest and revenue potential before being approved. This marks a shift in DeFi, moving away from aggressive multichain expansion toward a model that emphasizes quality over quantity.

Governance and Community Support

The governance proposal, titled “Focussing the Aave V3 Multichain Strategy,” has received unanimous preliminary backing from Aave token holders, reflecting strong community consensus. Authored by Aave Community Infrastructure (ACI), the proposal underscores the protocol’s commitment to adapting as DeFi matures and to ensuring its long-term viability.

With the development of the V4 upgrade underway and a $50 million annual AAVE buyback initiative planned, Aave is signaling a move toward more measured and sustainable growth as it looks ahead to 2026 and beyond.

Wider Implications for DeFi

Aave’s decision to streamline its multichain presence could have ripple effects throughout the DeFi landscape. As one of the sector’s leading lending protocols, Aave’s pivot may prompt other projects to adopt a more selective approach to multichain deployment. This trend reflects a growing understanding that success in DeFi is increasingly determined by security, profitability, and network quality—not just by the number of supported chains.

In conclusion, while AAVE’s recent price action highlights ongoing market headwinds, the protocol’s strategic realignment represents a deliberate move toward greater resilience and long-term success.