DeFi On-Chain Leverage Ratio Reaches 2021 Levels Amidst Capital Collapse

Written by Ohris M. Greyoon, Blockchain & Crypto Expert

Source: Coinmarketcap

Updated: Jun 16 2026

AAVE+0.536%

DEFI+0.3%

DRIFT-1.21%

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Leverage Ratio Surge: According to Binance Research, the on-chain leverage ratio in DeFi has risen to approximately 38%, matching 2021 highs, but this increase is primarily due to a decline in total value locked (TVL) rather than a surge in borrowing demand.
Significant TVL Decline: By the end of April, DeFi's TVL fell to about $82.7 billion, a 10.7% month-over-month decrease, indicating tightening market liquidity that could lead to heightened risks and potential liquidation events.
Black April Incidents: In April 2026, DeFi suffered over $606 million in hacks, triggering a $13 billion liquidity exodus as users withdrew from lending markets and yield platforms, highlighting growing concerns over market security.
Ongoing Risks: Although losses from attacks decreased by nearly 90% in May compared to April, Binance Research warns that leverage remains elevated, and the market may face further liquidation risks as the capital base continues to shrink.

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Technical Analysis for AAVE

Technical Sentiment Analysis for Aave (AAVE). As of , Aave (AAVE) is exhibiting a Buy technical sentiment. Our proprietary analysis, which aggregates 5 technical signals, shows that 4 indicators are flashing buy, while 1 are indicating sell.

Momentum Indicators: RSI, MACD & Overbought/Oversold Status. Currently, the Relative Strength Index (RSI) for AAVE stands at -, which suggests a Neutral condition. Meanwhile, the MACD (12, 26) indicator is at -, providing a Neutral signal for short-term momentum. Other oscillators like the Stochastic Oscillator at - and the Commodity Channel Index (CCI) at - further confirm a - outlook for the crypto.

Support, Resistance & Moving Averages. From a structural perspective, AAVE is trading below its 60-day moving average of $- and below its 200-day long-term moving average of $-. Key price levels to watch include the immediate resistance at $- and strong support at $-. A break above $- could signal a bull continuation, while falling below $- may test the next Fibonacci floor at $-.

Aave (AAVE) Support & Resistance Level

Name	S3	S2	S1	Pivot Points	R1	R2	R3
Classic	61.735	71.243	80.205	89.713	98.675	108.183	117.145
Fibonacci	71.243	78.298	82.657	89.713	96.768	101.127	108.183

About AAVE

Aave is a decentralized finance protocol that allows people to lend and borrow crypto.Lenders earn interest by depositing digital assets into specially created liquidity pools. Borrowers can then use their crypto as collateral to take out a flash loan using this liquidity.Aave (which means “ghost” in Finnish) was originally known as ETHLend when it launched in November 2017, but the rebranding to Aave happened in September 2018. (This helps explain why this token’s ticker is so different from its name!)AAVE provides holders with discounted fees on the platform, and it also serves as a governance token — giving owners a say in the future development of the protocol.

About the author

Ohris M. Greyoon

Ohris M. Greyoon holds a Master’s in Computer Science from MIT and has 10 years of experience in blockchain technology and cryptocurrency markets. A pioneer in decentralized finance (DeFi) analysis, he leads Intellectia’s Crypto News, offering cutting-edge insights into digital assets.

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