Kraken Explores 15% Aave Stake at $385 Million Valuation

Kraken, part of Payward Inc., is discussing a deal to acquire a 15% stake in decentralized lending protocol Aave at a $385 million valuation, CoinDesk reported, citing three people familiar with the matter. The proposed transaction would reportedly involve Kraken investing 35,000 ETH in exchange for 250,000 AAVE tokens and a 15% common equity stake in Aave Group.

The talks matter because they point to a continued convergence between centralized crypto exchanges and decentralized finance infrastructure. For Kraken, the investment would fit with parent company Payward’s effort to diversify its business and take a more active role in DeFi and related investment opportunities.

CoinDesk reported that two people familiar with the transaction said Kraken is also looking to syndicate the deal, which is worth around $71 million. A Kraken spokesperson declined to comment, while Aave had not responded to CoinDesk’s request for comment by publication time.

Aave is one of the largest DeFi lending protocols, enabling users to lend and borrow crypto assets through liquidity pools and smart contracts rather than traditional intermediaries. The protocol recently faced pressure after the fallout from April’s KelpDAO exploit, in which attackers tied to North Korea’s Lazarus Group allegedly minted roughly $292 million of unbacked rsETH.

According to CoinDesk, those tokens were deposited as collateral on Aave and used to borrow real assets, leaving the protocol with an estimated $190 million to $230 million in bad debt after the collateral became worthless. Aave’s own smart contracts were not compromised, but the incident triggered more than $8 billion in withdrawals, underscoring how quickly stress can move through interconnected DeFi markets.

The potential Aave investment also follows Kraken’s broader acquisition activity. In April, Payward agreed to acquire crypto derivatives exchange Bitnomial for up to $550 million, adding U.S. CFTC-regulated brokerage, clearing and exchange operations as Kraken builds toward a broader multi-asset platform.