market, where it might be a big deal. A recent update by Aave’s founder, Stani Kulechov, revealed why the rollout is of great significance.A historic overview of Aave might be useful in understanding why Aave Protocol V3 is important. According to the founder, DeFi summer and flash loans were pivotal in the network’s growth after Aave’s V1 rollout. The V2 launch was backed by more innovation and heavy staking. However, it also underscored some risks, which developers plan to address in Aave V3.
Aave v3 users will be better positioned to implement measures for mitigating risks during volatile and unfavorable market conditions. This move showcases the protocol’s efforts towards making its platform safer for users in the future.Adding an extra layer of security for users might be encouraging for future users. If that turns out to be true, then Aave will likely achieve a high TVL in a short time, just like it did with previous iterations.after its crash in the first half of November.
There were, however, some outflows from higher address categories. Despite this, exchange flows indicated that sell pressure slightly outweighed the prevailing buy pressure. Exchange flows have not recovered from the sharp drop in November. Slightly higher exchange inflows than outflows suggested a net flow in favor of the downside.Investors should note that AAVE’s demand was also heavily correlated with the rest of the market.