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Posted: September 18, 2024
Coinbase recently launched the cbBTC token, its wrapped version of Bitcoin, on Ethereum and Base.
Aerodrome Finance leads protocols rankings in terms of TVL on Coinbase’s Base network.
AERO, the native token of liquidity protocol Aerodrome Finance, has emerged as one of the best-performing crypto assets in the last two weeks, drawing the attention of many speculators.
AERO consistently gained ground from $0.49 on 6th September to a multi-week high of $0.72 on 13th September, erasing the dip from earlier this month.
Source: CoinMarketCap
Aerodrome has also made significant strides in capturing DEX market share thanks to its ‘landing hub’ status for protocols seeking to deploy on Coinbase’s L2 scaling network, Base.
In the latest display of Aerodrome’s ecosystem growth, AERO has emerged as the biggest beneficiary from the recent launch of Coinbase’s Wrapped BTC token.
Coinbase’s wrapped BTC launch drives AERO price
Last week, Coinbase launched its version of wrapped Bitcoin (cbBTC) to compete with similar forms of tokenized BTC assets in the market, including the category leader, WBTC, from BitGo.
In its announcement, Coinbase highlighted several DeFi apps, including Aerodrome, Curve, and Uniswap DEXes, that will support cbBTC from day one.
This wave of liquidity from cbBTC appears to have played a pivotal role in boosting the AERO token.
“Just a few days in, and Aerodrome Finance is just a hair from taking the top spot for $BTC trading,” one observer wrote today.
TradingView data shows AERO price rose from $0.55 to $0.61 on the launch day before climbing further to $0.72 in the subsequent 24 hours.
Source: TradingView
Outside the spot market, Aerodrome has established itself as a noteworthy project among its peers with observers pointing to its unique positioning within the DeFi space as the key driver.
DeFiLlama data shows the total value locked (TVL) on Aerodrome has grown by 23% in the last seven days to $687.68 million at the time of writing.
Renewed competition among DEXs
The cumulative monthly trading DEX volume rose from $125 billion in June to almost $145 in July but fell to $135 last month. Despite the month-over-month decline in August, Aerodrome’s volume grew from $7.2 billion to $9.9 billion.
Source: DeFiLlama/Block
In terms of dominance, Aerodrome has held its own, carving out a respectable 5.17% of the DEX market capital as of 13th September. Though Uniswap still dominates and accounts for nearly three-quarters of the market cap share, this notable shift highlights the growing competition in the DEX landscape.
AERO near-term outlook and price target
$AERO has put up a remarkable performance in 2024, with its price growing more than fourfold year-to-date. In February, AERO price rallied on the news of the Base ecosystem fund investing in Aerodrome by acquiring an undisclosed position in the project.
AERO was trading at $0.684 at press time, up 22% in the last 7 days.
Source: TradingView
The $0.75 level stands out as immediate resistance on the 4-hour chart with AERO/USDT having most recently contended with this height in August.
Looking ahead, analysts remain fairly optimistic about Aerodrome’s continued growth.
“AERO has shown strong support around the $0.44 mark, indicating a potential turning point. If Bitcoin maintains its bullish trend, it will surpass our next target of $1.25,” chart commentator Decilizer noted in his thesis earlier this week.
The token’s strong performance, paired with the growing adoption of cbBTC could help the AERO/USD pair maintain its upward trajectory in the short term.
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