Aerodrome’s (AERO) recent inclusion in Grayscale’s list of top 20 assets for Q1 2025 has attracted significant attention from both institutional and retail investors. This endorsement from a major player in the cryptocurrency space often signals increased interest and capital inflows into the asset, which could potentially push its price beyond its current resistance levels.

Grayscale’s acknowledgment of AERO reflects its growing appeal in the crypto market. Historically, Grayscale’s involvement in promoting specific assets has contributed to price appreciation, as it often draws attention from both institutional players and large-scale investors. With its mention in Grayscale’s latest report, AERO could see a boost in both visibility and demand, especially as investors look for emerging opportunities in the first quarter of 2025.

Market Dynamics: Smart DEX Traders and Whale Activity

While Grayscale’s inclusion of AERO is a positive signal, the market sentiment is not entirely straightforward. Smart DEX traders, who have played a key role in AERO’s recent market fluctuations, are currently in a distribution phase. This suggests that buying pressure is beginning to wane, which could impact the short-term price movement of AERO. These traders had previously taken advantage of the asset’s volatility, with AERO experiencing a surge in value, reaching approximately 30x gains from its lows to the highs. However, as selling pressure increases, the momentum appears to be slowing down.

In addition to the smart DEX traders, whale activity has also been a significant factor in AERO’s price behavior. Whales—large investors—have been actively distributing AERO, with daily sales ranging between $500K to $7 million. This level of distribution stands in stark contrast to the optimistic outlook promoted by Grayscale, suggesting a divergence in sentiment between institutional players and large holders.

Despite the notable selling pressure from whales, smaller investors, often referred to as “smart money,” have continued to show interest in AERO. These investors have been capitalizing on lower price levels, though their buying power may not be enough to overcome the resistance created by the large holders’ distribution.

AERO’s Price Action and Market Indicators

At the time of writing, AERO’s price sits at approximately $1.51, down from its previous high of $2.38. This price fluctuation highlights the current volatility and mixed sentiment surrounding the asset. Chart indicators, such as LuxAlgo’s market structure, suggest that AERO could either experience upward momentum or face significant resistance, depending on the market’s next moves. The price has broken key levels, indicating a volatile period ahead, with the potential for both gains and corrections.

If AERO can regain upward momentum, it could challenge its previous all-time high (ATH) of $2.38. This potential for a breakout makes AERO an attractive asset for traders looking to capitalize on the fluctuations in the market.

AERO’s Financial Health: TVL, Active Addresses, and Market Cap

Beyond price action, AERO’s financial health shows promising signs. The project boasts a total value locked (TVL) of $1.409 billion and a market capitalization of $1.117 billion, indicating a solid foundation for its ecosystem. Furthermore, its daily trading volume has remained robust, peaking at $54.03 million, with annualized revenue of $339.06 million, signaling healthy activity within the platform.

However, not all indicators are bullish. According to IntoTheBlock, 60.42% of AERO holders are “in the money,” meaning they purchased their AERO at lower prices than the current market value of $1.51. This percentage suggests that there could be significant selling pressure if these holders decide to cash out their positions. Meanwhile, 24.95% of holders are “out of the money” and may be waiting for higher prices, while 14.63% are “at the money,” indicating that they may be in a position to make buying or selling decisions based on short-term market fluctuations.

Additionally, AERO’s daily active addresses have decreased by 29.10%, signaling a decline in user engagement. This drop could be due to market uncertainty or the natural ebb and flow of interest in the asset. However, new addresses for AERO have increased by 6.47%, suggesting that there is still some fresh interest in the asset. Notably, the number of “zero balance” addresses has also risen by 13.89%, indicating that some users may be exiting their positions.

Looking Ahead: Can AERO Break $2.38?

The current market sentiment surrounding AERO is mixed. On one hand, Grayscale’s endorsement and strong fundamentals suggest that AERO has potential for future growth. On the other hand, the increasing selling pressure from whales and the decline in active addresses may present challenges for the asset’s price in the short term.

Traders looking for opportunities in AERO should keep an eye on the distribution phase, as well as any signs of renewed buying interest. If AERO can break past its resistance level of $2.38, it could set the stage for further gains and potentially reach new highs. However, the asset’s price could also face challenges as the distribution phase continues.

As AERO navigates these market dynamics, it will be interesting to see how the asset evolves in the coming weeks. With the right catalysts—such as new partnerships or technological developments—AERO could overcome its resistance and continue its upward trajectory. However, the ongoing selling pressure from whales and the mixed sentiment among traders will play a key role in determining its short-term price movements.