Standard Chartered Backs Aave on Growing Tokenization Trend

TLDR

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Standard Chartered identified Aave as a potential beneficiary of growing tokenized asset activity in DeFi.
The bank said tokenized assets could drive higher deposits and lending activity on Aave.
Geoff Kendrick stated that recent pressures from lower crypto prices and the KelpDAO incident are fading.
Aave’s deposit base reached about $75 billion in October 2025, according to the research note.
Standard Chartered expects tokenized real-world assets to become a larger source of DeFi collateral.

Standard Chartered has identified Aave as a potential beneficiary of growing tokenized asset activity within decentralized finance. The bank said rising adoption of tokenized assets could increase deposits on the lending protocol and support a recovery in its market position. The assessment appeared in a research note published Wednesday by Geoff Kendrick, the bank’s global head of digital assets research.

Aave Seen Regaining Ground as Market Pressures Ease

Kendrick said Aave remains the largest decentralized lending protocol despite recent challenges. He stated that weaker digital asset prices and the April KelpDAO cybertheft affected the platform’s recent performance. He also said those factors reduced Aave’s lending market share as assets moved away from the protocol.

The research note linked part of the decline to the $292 million KelpDAO incident. According to Standard Chartered, the event contributed to lower activity on Aave during the period. However, Kendrick said the protocol has moved past the disruption and now faces improving conditions.

“We think both of those negatives are poised to fade,” Kendrick wrote. He added that the bank expects digital asset prices to rise into year-end.

As a result, Standard Chartered believes conditions could support renewed growth on the platform.

The bank also compared Aave’s deposit scale with traditional banking institutions. Kendrick said Aave’s deposit base reached about $75 billion in October 2025. He added that this figure would have placed the protocol near the 30th-largest U.S. bank by deposits.

Standard Chartered expects Aave to recover part of that scale over time. The bank pointed to increasing use of tokenized assets as collateral within decentralized finance. It also said those assets could become new liquidity sources for lending markets.

Tokenized Assets Drive Standard Chartered’s Outlook

The research note extends Standard Chartered’s existing tokenization framework into decentralized lending. The bank said tokenized real-world assets could create new borrowing activity across onchain platforms. Under that view, Aave could serve as a venue for loans backed by tokenized assets.

Kendrick linked the forecast to broader growth in tokenized markets. He said tokenized assets could bring more deposits into decentralized finance protocols. In turn, those assets could increase activity on lending platforms that already hold large liquidity pools.

Standard Chartered previously projected that assets locked in decentralized finance could reach $2.7 trillion by 2030. The bank attributed that forecast to growth in tokenized real-world assets and crypto-native products. Those assets would move through blockchain-based financial protocols.

The report also referenced decentralized exchange activity tied to tokenized markets. Kendrick identified Uniswap as a potential trading venue for tokenized assets. He cited the platform’s scale, brand recognition, and operating history across several crypto market cycles.

Standard Chartered’s latest note places Aave at the center of its decentralized lending outlook. The bank said expanding tokenized asset usage could support higher protocol deposits. The report also maintained that tokenized assets may become an increasing source of collateral within DeFi markets.

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