Aave positioned to capture tokenized asset growth in DeFi: Standard Chartered

Banking giant Standard Chartered has identified Aave as a potential beneficiary of tokenized assets as they move into decentralized finance (DeFi), saying the protocol could rebuild its position as a dominant onchain lending platform.

In a Wednesday research note, Geoff Kendrick, the bank's global head of digital assets research, said active tokenized assets in DeFi could drive more deposits into Aave.

“Despite recent setbacks, we are bullish on the outlook for Aave, the largest [DeFi] lending protocol,” Kendrick wrote.

The bank said Aave’s recent performance had been weighed down by a broader decline in digital asset prices and the fallout from the April cybertheft involving KelpDAO. Standard Chartered said the $292 million incident affected Aave, contributing to a decline in the protocol’s lending market share as assets exited the platform. 

“We think both of those negatives are poised to fade,” Kendrick said. “We forecast significant upside for digital asset token prices into year-end, and we think Aave has moved beyond the April incident.”

According to the research note, Aave's October 2025 deposit base of about $75 billion would have ranked alongside the 30th-largest US bank by deposits. Kendrick added that Standard Chartered expects Aave to recover part of that scale as tokenized assets become more widely used as collateral and sources of liquidity within DeFi. 

Aave’s total value locked. Source: DefiLlama

Standard Chartered expands tokenization thesis to lending

The Aave forecast extends Standard Chartered's tokenization thesis from decentralized trading to lending, with the protocol emerging as a potential venue for borrowing against tokenized real-world assets (RWAs).

Standard Chartered said in an earlier research note that assets locked in DeFi could reach $2.7 trillion by 2030, driven by RWAs and other crypto-native assets moving through onchain protocols. 

Kendrick identified decentralized exchange Uniswap as a possible trading hub for tokenized markets, citing its scale, brand and history of operating through multiple crypto market cycles.