Standard Chartered sees 'generational wealth' in potential Aave recovery, predicts 50x upside by 2030
Standard Chartered initiated coverage of Aave on Tuesday, forecasting the decentralized lending protocol's native token could rise 50x to $3,500 by the end of 2030 from roughly $74 today.
The initiation, authored by Geoffrey Kendrick, the bank's global head of digital assets research, extends a series of bullish decentralized finance calls Standard Chartered has published this year.
The Block covered the bank's April note arguing DeFi was "bent, not broken" after the KelpDAO exploit, its May projection of $4 trillion in tokenized assets by end-2028, and its June initiation of Uniswap (UNI) with a $100 end-2030 target.
Aave is the third DeFi protocol to receive formal coverage under that framework, with a price target the bank frames as a bet on DeFi's structural recovery and a coming wave of real-world assets moving onchain.
The recovery case
The April 18 exploit of KelpDAO — which saw roughly $292 million in rsETH drained from a LayerZero-powered bridge and deposited as collateral on Aave — looms over the initiation as context rather than obstacle, per Standard Chartered's read.
The Block reported the incident and its spread to Aave as the protocol froze rsETH-related markets and absorbed sharp deposit outflows.
At the time, the damage was substantial.
Deposits on Aave fell from $44 billion to $23 billion following the exploit, while active loans dropped from $18 billion to $9.5 billion, according to Kendrick’s note.
Aave's share of the broader lending market fell to 38% of deposits and 42% of active loans, down from 59% and 64%, respectively, in the 12 months before the theft.
Standard Chartered views those figures as a trough.
A slight uptick in both metrics from early June coincided with an announcement by Aave founder Stani Kulechov that the protocol was developing a new risk framework — still pending governance review— which the note cites as a sign of confidence.
How the model works
The thesis is built on a single structural observation: Aave's business model is linear.
Deposits drive loan volume, loan volume drives fee income, with 90% of Aave's fees derived from net interest margin in the last 12 months, and fee income drives market cap.
The protocol's loan-to-value ratio has held broadly steady at around 40% over the past two years, and roughly 15% of total fees accrue to the protocol as revenue, with the remaining 85% paid to liquidity providers.
The AAVE token buyback program, launched by the Aave DAO in April 2025 and paused the day after the KelpDAO exploit on April 19, is another lever that Kendrick flagged. The program had repurchased 205,000 AAVE tokens — approximately 1.3% of total supply — before it was halted. Standard Chartered supports the resumption of the buybacks.
The DeFi growth engine
The longer-term case rests on a projection that the value of assets deployed in DeFi will reach roughly $2.7 trillion by the end of 2030, a 37x increase from current levels.
Standard Chartered attributes that growth to expanding stablecoin supply, which is forecast to hit $2 trillion by the end of 2028 from roughly $310 billion today, rising tokenized non-stablecoin real-world assets and a rising share of tokenized assets actively deployed in DeFi, climbing to 30% from 3.5% today.
Notably, scaling Aave Horizon, the protocol's permissioned lending market for tokenized RWAs, launched in August 2025, is the critical longer-term driver in Kendrick’s view.
However, take-up has been slow. The platform held $163 million in active loans as of the end of May, against a total tokenized RWA market cap Standard Chartered puts at roughly $30 billion.
The note acknowledges that scaling Horizon to TradFi players will require navigating idiosyncratic compliance requirements across institutions, and that clearer U.S. regulatory frameworks, including potential passage of the Clarity Act, could accelerate the process.
V4 and GHO
Aave V4, launched in March, is seen as a structural defense upgrade. Its hub-and-spoke architecture enables liquidity sharing across participating layer-2 protocols within the Ethereum Economic Zone, bypassing the need for bridges — the attack vector exploited in the KelpDAO incident.
As of the note's publication, 99.4% of Aave's deposits remain on V3, with only 0.4% migrated to V4. The EEZ is expected to go live on the mainnet this summer.
Aave's GHO stablecoin rounds out the medium-term upside case. Outstanding supply has grown to roughly $600 million since GHO's 2023 launch, a solid trajectory, the note allows, but still niche by stablecoin standards.
Unlike fee income from standard lending markets, all GHO-associated fees flow directly to the protocol, with no payout to external liquidity providers.
The targets
Kendrick's staged price targets place AAVE at $180 by end-2026, $600 by end-2027, $1,200 by end-2028, $2,200 by end-2029, and $3,500 by end-2030.
The note projects AAVE will outperform both ETH and BTC across that horizon, with Standard Chartered's reference forecasts putting ETH at $40,000 and BTC at $500,000 by end-2030.
Kulechov welcomed the note on X. Aave's smart contract model compresses traditional lending cost structures and "potentially the model could be applied to cater to the whole $400T finance industry," he wrote in a post.
