Aave liquidation heatmap

What the map shows

A perpetual futures position is borrowed money. Every leveraged trade carries a price at which the exchange closes it automatically, because the margin behind it has run out. That price is not a secret: it follows mechanically from the entry price and the leverage used.

This map is the liquidation heatmap for the selected venue's AAVE perpetual over the chosen window. It takes the open interest added in each period, works out roughly where those positions were opened, and projects the price at which each standard leverage tier would be liquidated. Stack all of those projections together and you get a surface: bright where a lot of forced closing sits waiting, dark where there is almost none.

AAVE is one of the longest-listed DeFi perpetuals, and it trades on protocol news as much as on the wider market: a steady base of bands away from spot, with sharper clusters built around governance and revenue headlines.

Time runs left to right, price runs bottom to top: The dotted line is the actual AAVE price over the same window. Bands that survive to the right edge are leverage that price has not yet reached.

How to read it

• Bright bands above price are shorts. If AAVE rallies into one, those shorts get bought back by the exchange, which adds buying to a move that is already up.
• Bright bands below price are longs. If AAVE falls into one, those longs get sold, which adds selling to a move that is already down.
• A band that ends abruptly was consumed. Price traded through it, the positions were closed, and the liquidity is gone. That is why the surface is cleared behind the price line rather than left painted.
• Thin, tight bands very close to spot are the 100x crowd. They are large in count and small in notional, and they get taken out constantly.
• Wide bands far from spot are the 10x crowd. Rarer, much bigger, and the ones that produce the headline cascades.

What is different about Aave leverage

AAVE leverage behaves like a mid-cap's. The region near spot is busy, and the bands further out are large enough to matter on their own. Its moves tend to come in steps, so a band can sit untouched for weeks and then be cleared in a single session.

Protocol news moves it. Buybacks, deposit growth on Aave itself or trouble at a large borrower can move AAVE apart from the rest of the market, reaching clusters at times when the majors are quiet.

Every book on the picker carries an AAVE perpetual, so the venue control is a genuine comparison. Where one venue holds a cluster the others do not, that is one crowd's positioning and not the market's. AAVE carries the 24 hour to 90 day windows; the longer maps are published for Bitcoin and Ethereum only.

Why clusters move price

A liquidation is not a normal sale. It is a market order the exchange sends on the trader's behalf, at whatever price the book offers, with no regard for slippage. When a dense cluster is hit, thousands of those orders fire inside a few seconds against a book that has usually already thinned out.

That is the cascade mechanic. Price reaches a cluster, the cluster fires, the firing pushes price further in the same direction, and the push reaches the next cluster. It stops when it runs out of stacked leverage or when resting bids and offers are deep enough to absorb the flow.

Using it without getting run over

1. Start with the 7 day window: AAVE's meaningful clusters build over days around news, and the 7 day view shows which of them survived the churn.
2. Treat clusters as risk, not as entries: Knowing where forced selling sits tells you where a move is likely to accelerate. It does not tell you the move is coming.
3. Do not park a stop inside a cluster: That is precisely the price where slippage is worst.
4. Watch which side is heavier: When one side of price holds most of the leverage, the path of least resistance usually runs toward it.
5. Check the window: A cluster built over thirty days is a different animal from one built in the last six hours.
6. Size for the cascade, not the level: If you are long into dense long liquidity below, assume the fall through it will be faster than normal.

What it cannot tell you

• A blended level is not one order book: All exchanges adds the venues together, so a bright band there can be mostly one book. Only that book's own price trading through it triggers those positions, so pick the venue out before sizing around a level.
• It cannot see cross-margin: A trader with collateral spread across several positions is liquidated on portfolio health, not on a single price.
• It assumes standard leverage tiers: Real traders use 7x and 33x and every number in between.
• It is not a forecast: A dense cluster at 8% below spot says what happens if price gets there. It says nothing about whether it will.