In a research note published on Wednesday, British multinational bank Standard Chartered highlighted that tokenized assets moving to decentralized finance (DeFi) platforms could result in higher deposits to lending platform Aave (AAVE).
Standard Chartered’s bullish case for Aave
Aave could be the biggest beneficiary of tokenized assets going on-chain, Standard Chartered’s head of digital assets research Geoffrey Kendrick said in a note. Kendrick added:
“Despite recent setbacks, we are bullish on the outlook for Aave, the largest DeFi lending protocol. We think both of those negatives are poised to fade. We forecast significant upside for digital asset token prices into year-end, and we think Aave has moved beyond the April incident.”
In his comment, Kendrick recalled the recent Aave exploit that involved KelpDAO. The $292 million theft had an adverse impact on AAVE token’s price, as it cratered from around $118 on April 17, to as low as $58.7 on June 6.
Following the unfortunate incident, there was a severe pullback in the protocol’s lending market share, with a significant amount of digital assets leaving the platform. The following chart from DefiLlama shows the extent to which Aave’s total value locked (TVL) suffered due to the exploit.
The research note states that Aave’s October 2025 deposit base of around $75 billion would rank alongside the 30th-largest U.S. bank in terms of deposits. The bank foresees Aave recovering part of the scale as the trend of tokenized assets being used as collateral and sources of liquidity in DeFi becomes more prevalent.
In an earlier research note published on June 15, Standard Chartered predicted a similar bullish outlook for leading decentralized exchange (DEX) Uniswap. At the time, the bank said that the UNI token price could increase by 40 times by 2030.
In the same note, the bank stated that asset tokenization could push the value of DeFi to as high as $2.7 trillion by 2030. The financial institution attributed the potential growth to the trend of RWAs and crypto-native assets moving through on-chain protocols.
AAVE undervalued at current price level?
As of Wednesday, AAVE is trading at just over $75 – up 3.4 percent over the past 24 hours. That said, a report by Grayscale, published on June 16, opined that the digital asset is undervalued at current market prices.
Meanwhile, Aave is taking measures to navigate the murky crypto regulatory space, consistently having a dialogue with financial watchdogs around the world. On May 28, Aave Labs secured the coveted FCA approval in the UK.
