Category: RWA
Grayscale's AAVE ETF Filing Ignites DeFi TVL Boom: Analyzing the $896M Catalyst for Explosive Growth
As DeFi TVL hits new highs with Aave leading at over $50B, the AAVE ETF emerges as a game-changer, bridging TradFi and decentralized lending for unprecedented growth. Grayscale's February 13, 2026, S-1 filing to convert its $858K Aave Trust into a spot ETF—holding AAVE tokens directly—has analysts projecting a potential 2–5x TVL boost for the DeFi lending leader, drawing parallels to BTC/ETH ETF inflows that added $57B to crypto markets. With Aave dominating 40% of DeFi lending at $15B+ TVL and $100M+ annualized revenue, ETF approval could flood the protocol with fresh liquidity, but governance centralization risks loom as institutions buy voting power.
Mortgage on the Blockchain: Better-com's Tokenized Home Loan Play Could Rewrite How America Borrows
Better.com is exploring whether home mortgages — America's largest and most illiquid asset class at over USD 13 trillion in outstanding balances — can be tokenized on-chain, opening them to DeFi liquidity pools, fractional institutional investment and automated smart contract servicing. If it works, the implications stretch far beyond one digital lender and into the structural foundations of how housing finance is originated, held, traded and settled globally.
China’s RWA Tokenization Ban vs. Hong Kong’s Consensus Optimism: Asia’s Crypto Divide Deepens
On February 6, 2026, China’s State Council approved a sweeping formalization of its crypto clampdown, explicitly banning unapproved yuan‑linked stablecoins and curbing onshore real‑world asset (RWA) tokenization projects while instructing mainland firms to pause offshore efforts in Hong Kong. This comes as Hong Kong hosts Consensus 2026—kicking off February 11—with HKMA and SFC touting stablecoin licenses and tokenized green bonds, underscoring Asia’s stark regulatory divergence amid global RWA hype.
Grayscale's Spot AAVE ETF Filing: DeFi Goes Institutional
Grayscale Investments submitted Form S-1 to the U.S. SEC on February 13, 2026, to convert its existing Aave Trust (GAVE) into a spot exchange-traded fund, marking the first proposal to bring a DeFi lending protocol's governance token to NYSE Arca. With Coinbase as custodian and a 2.5% sponsor fee payable in AAVE, the filing—following Bitwise's December bid—ignited a 22% token rally from $106 to $128, as markets price in institutional DeFi access and potential SEC clarity on altcoin ETFs.
Stablecoin Vulnerabilities: The Hidden Risks Threatening Crypto's $200B Lifeline
Stablecoins underpin $200B+ in DeFi TVL and trillions in annual volume, but Chainalysis reports $3.41B stolen in 2025 alone through exploits, phishing, and bridge hacks—making them the crypto ecosystem’s most targeted asset class. The Saga 2026 exploit, which depegged its stablecoin to $0.75 and wiped 55% of TVL in 24 hours, exemplifies cross‑chain vulnerabilities in modular ecosystems, while classics like Euler ($197M) and Curve ($100M+) expose smart contract flaws that persist despite audits.