AAVE Experiences Significant Drops Despite Optimism for V4 Upgrade

Current Market Status: AAVE is trading at $278.36 after a 5.33% decline, with its market cap dropping from $5.41 billion to $4.08 billion, indicating fragile short-term momentum amid mixed investor sentiment.

Potential for Growth: Analysts suggest that AAVE could reach $1,000 due to the upcoming V4 launch and GHO stablecoin, but caution against risks of a market crash that could lower the price to $200 or $150.

Historical Performance: AAVE has experienced significant price fluctuations since 2021, with a peak of $640 followed by a drop to $52, and is currently consolidating between key support and resistance levels.

Fundamental Weakness: Despite technical improvements, AAVE faces declining core metrics, including a drop in fees and market dominance, which raises concerns about its near-term performance despite long-term growth potential.