Aave has launched a dedicated lending vault that accepts several of Coinbase's leading tokenized stocks as collateral, and the vault has attracted liquidity quickly in the days since going live — a step that connects regulated equity exposure with on-chain stablecoin liquidity.

The vault sits within Aave's V4 hub on the Base network, using selected Coinbase tokenized equities as collateral, according to Aave's announcement. As Cryptopolitan reported earlier, Aave's V4 toolset is designed to tap traditional finance and bring Wall Street activity to existing chains. The launch extends Aave's collateral base beyond crypto assets, bringing tokenized equities into one of DeFi's largest lending markets.

Users can post tokenized shares of Apple (AAPL), Amazon (AMZN), Google (GOOG), Meta (META), Microsoft (MSFT), Nvidia (NVDA) and Tesla (TSLA) as collateral and borrow USDC, which can be deployed as DeFi liquidity or for further trading.

There is still no standard for using tokenized equities in DeFi. At present, only Morpho operates curated vaults built on selected Coinbase equities, with vaults curated by Steakhouse and Chipwork offering variable-rate USDC loans. Aave's vault now offers USDC borrowing against the same class of collateral, placing it alongside those curated vaults in a segment that is still taking shape.

The new vault already holds $8.14 million in value based on current Coinbase tokenized valuations. Lending utilization remains relatively low at 5%, with only around $495,000 in loans issued from the vault so far. Aave's goal is to offer far easier access to equity-backed loans, a process that is longer and more involved in traditional finance. With liquidity in place but borrowing still light, utilization is the metric to watch as a gauge of actual demand for on-chain equity-backed credit.

The launch arrives as most of the Magnificent 7 stocks have posted double-digit gains over the past month, with Amazon the sole exception. It also coincides with markets trending upward again, with US equities pushing the S&P 500 close to new records.

Will Aave be able to set the right price?

A core challenge with tokenized equities as collateral is that Coinbase token prices are supplied based on official stock trading, while Chainlink oracles do not update during the weekend. Equity collateral therefore cannot be priced as continuously as crypto-based loans, and weekend market closures remain the structural stress case for this collateral type.

Stani Kulechov, founder of Aave, laid out how the protocol balances its lending vault:

“We measure the volatility properties of an asset, set liquidation thresholds against the bad debt buffer the market is prepared to defend, and calibrate a liquidation bonus that incentivizes to profitably clear liquidatable positions before the price can travel past the safety margin,” Kulechov explained in an X post.

The approach mirrors how Aave handles crypto volatility and prevents liquidations. The aim is to avoid loan liquidations even if the underlying stocks receive negative news over a weekend.

For Coinbase's tokenized shares, the underlying assets are held by Alpaca Securities LLC, a regulated broker-dealer. The custodian will not lend or move the shares in any way; they serve only to back the traded tokens. Dividends are reinvested rather than paid out, meaning token holders simply hold a claim on a growing number of shares.

AAVE trades near three-year peak

The addition of stocks as collateral comes as Aave has grown more central to DeFi. The recovery of ETH and the expansion of tokenized asset trading have boosted demand for lending.

Aave's total value locked has recovered to more than $19 billion, its highest level since the hack of Kelp DAO, and the protocol generates over $5 million in monthly earnings. Aave carries over $13 billion in tokenized loans, most of which use ETH as their main collateral, with the majority of loans denominated in USDT and USDC.

As a result, AAVE tokens trade close to their three-month peak and near the upper end of their 2026 range. AAVE changed hands around $148.08 with $255 million in daily volume, while open interest fluctuates around $233 million after a recent 9% drop following liquidations.