Tag: defi
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.
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.
FCA's Stablecoin Sandbox Goes Live: UK Positions for Regulated Crypto Payments Leadership
The Financial Conduct Authority (FCA) has launched a stablecoin-specific cohort within its flagship Regulatory Sandbox, inviting issuers to test live GBP-pegged stablecoins under supervision—ahead of the full regime rollout expected in late 2026. With applications closed on January 18, selected firms are now live-testing issuance, redemption, and payments using real market data, directly informing prudential rules, reserve requirements, and consumer protections for what FCA Executive Director David Geale calls a "priority" for faster, more convenient UK payments.