Aave Founder Touts Onchain Lending as Catalyst for $50T Asset Expansion

• Aave founder says solar energy is one of the world’s fastest growing sectors, and in a state of abundance, would be a $30-$50 trillion industry.
• He says Aave can capture up to 25% of the financing needs of this sector, which would add up to $12.5 trillion to its DeFi ecosystem.

Solar energy has grown rapidly over the past decade from just 40 GW in 2010 to 2,000 GW globally in 2024. Annually, the sector is recording $600 billion in investment. By 2050, this sector will require a minimum of $10-$12 trillion in investment to meet global needs, with some estimates going as high as $50 trillion. Decentralized lending should be aiming for this market, and according to Aave founder Stani Kulechov, his platform could control up to 25% of this new market by 2050.

In a recent article, Kulechov broke down the global solar energy market, from its past growth to its current state, output, funding and challenges. The goal for most countries is to hit abundance, described as a state where “something scarce, expensive, and accessible only to a few becomes cheap, plentiful, and available to all.”

Today, China is investing $200 billion annually to achieve abundance, while the US deploys $50 billion. Europe is at $80 billion, with development banks, national funds and the private sector also investing in excess of $200 billion.

The investment has been growing every year, with solar energy being ideal for financing as it’s a simple product with high leverage, predictable cash flows and modular scaling.

Conservative estimates say that the world needs at least $12 trillion invested in solar energy to produce 4-15 TW of energy by 2050. Moderate estimates place the demand at $20 trillion, while a state of abundance would require $30-$50 trillion over the next two decades.

Aave to Power Decentralized Solar Energy Financing

At $50 trillion, the sector would be worth more than the combined assets under BlackRock ($14 trillion) and JPMorgan ($4.5 trillion). This massive market would be a prime candidate for decentralized lending, especially for smaller solar energy producers, who would contribute a bulk of the power in a state of abundance.

Kulechov states:

All this would be facilitated by Aave v4 and stablecoins. As we have reported, v4 is currently being developed on the testnet, which launched publicly last November. In December, Kulechov announced the launch of the hub-and-spoke liquidity model on the testnet to boost growth.

The expansion would fit right into the protocol’s 2026 strategy, which as CNF reported, aims to scale DeFi to trillions.

For DeFi to finance this state of abundance, tokenization will have to become mainstream, Kulechov adds. However, RWAs “have been stuck at a $20 billion market cap despite nearly all large banks and asset managers having digital asset teams focused on this effort.” This is because they have focused on tokenizing scarcity-based systems, rather than abundance systems.

He concluded:

AAVE trades at $126.9 at press tme, starting the week with a 3% dip for a $1.94 billion market cap.