Kraken is in talks to buy a 15% stake in Aave at a valuation of $385 million, a move that would tie one of crypto’s biggest exchanges more closely to a lending protocol still repairing the damage from April’s KelpDAO exploit fallout.
The discussions, reported by people familiar with the matter, come as Aave works to rebuild deposits after a sharp withdrawal wave hit the platform in the wake of the exploit. Aave itself was not hacked. Even so, the broader incident rattled confidence across parts of the DeFi market and pushed users to pull funds from the lender.
For Kraken, a purchase of that size would be a strategic bet on a blue-chip DeFi name at a depressed valuation. For Aave, it could bring in a heavyweight backer at a time when the protocol is trying to steady liquidity and reassure users that the system remains sound. The size of the stake suggests Kraken is not just exploring a commercial partnership, but a meaningful ownership position in a platform whose token, AAVE, remains closely watched by traders.
The reported valuation is far below the peak multiples many DeFi projects commanded during the last cycle. That matters because pricing in a fresh investor at $385 million would imply the market is still assigning a steep discount to Aave’s growth prospects and to the recovery path after the deposit exodus. If the deal advances, it would also stand as one of the clearer examples of a centralized exchange taking a direct equity-style position in a major DeFi lender.
Aave has remained one of the most used lending protocols in crypto, with users borrowing and lending assets onchain without a bank in the middle. But the KelpDAO episode showed how quickly sentiment can turn when funds move out en masse, even if the protocol itself is not the source of the breach.
Traders will be watching for any formal announcement from Kraken or Aave, along with evidence that deposits are stabilizing. For AAVE holders, the key question is whether a strategic investment would help restore trust or simply mark a low-water valuation after a bruising month for DeFi liquidity.
Kraken talks to buy 15% of lending protocol Aave during its recovery phase
Kraken is negotiating to acquire a 15% stake in DeFi lender Aave at a $385 million valuation. Aave is working to recover after a major exploit caused a large withdrawal of deposits, although the protocol itself was not hacked.