Kraken in Talks for 15% Aave Stake at $385M Valuation

AAVE News

Crypto exchange Kraken is in talks to acquire a 15% stake in Aave (AAVE), the largest decentralized lending protocol, in a deal that values the platform at $385 million. According to people familiar with the negotiations, Kraken would invest 35,000 Ethereum (ETH) in exchange for 250,000 AAVE tokens and a 15% common-equity position in Aave Group. The proposed structure ties one of the sector’s most established Aave entities directly to a centralized exchange. AAVE rallied on the report, and the move signals renewed institutional appetite for DeFi infrastructure even after a turbulent spring for the protocol.

The transaction, worth roughly $71 million, is also being shopped for syndication, with Kraken evaluating bringing additional investors into the deal. Sources describe it as the first in a planned series of acquisitions under Payward Asset Management, the investment arm of Kraken’s parent company Payward Inc. The push reflects a broader strategy to diversify revenue and take a more active role in altcoin and DeFi opportunities ahead of a potential public listing. Both Kraken and Aave declined to comment publicly, leaving the precise terms unconfirmed, though the documented structure points to a strategic rather than purely financial bet on the lending protocol’s long-term franchise.

The deal arrives months after Aave sat at the center of one of DeFi’s largest crises. In April, attackers tied to North Korea’s Lazarus Group exploited a cross-chain bridge operated by KelpDAO to mint roughly $292 million of unbacked rsETH. The tokens were deposited as collateral on Aave and used to borrow genuine assets, leaving the protocol with an estimated $190 million to $230 million in bad debt once the collateral became worthless. Although Aave’s own smart contracts were never breached, the contagion triggered a rapid exit, with on-chain data showing more than $8 billion in deposits withdrawn as users moved to cut exposure.

Separately, Standard Chartered initiated formal coverage of Aave this week, assigning the token a long-term price target of $3,500 by the end of 2030. Measured against a recent level near $74, that projection implies upside of nearly 50 times. The bank’s digital-assets research framed the call as a structural wager on a recovery in decentralized finance and an approaching wave of real-world-asset tokenization. It marks the third DeFi protocol the bank has covered, after a similarly bullish thesis on Uniswap, and the report forecasts AAVE outperforming both Ethereum and Bitcoin over the projection window.

The research also quantified the damage from the spring exodus. Aave’s total deposits roughly halved, falling from about $44 billion to $23 billion, while active loans dropped from $18 billion to $9.5 billion. The protocol’s share of the lending market slid in tandem, with deposit and active-loan share falling to 38% and 42% respectively, down from 59% and 64% over the prior twelve months. The analysis noted both metrics began ticking higher in early June, a modest rebound it read as an early signal that confidence is returning to the platform.

Underpinning the bullish case is Aave’s linear fee model, with roughly 90% of trailing-year fees derived from net interest margin, alongside a token buyback program. The DAO-approved buyback launched in April 2025 but was paused a day after the KelpDAO incident, having already repurchased about 205,000 AAVE, or 1.3% of supply. Standard Chartered’s staged targets run from $180 by end-2026 to $600, $1,200 and $2,200 in subsequent years before reaching $3,500. The bank flagged Aave Horizon, the permissioned market for tokenized real-world assets, as the key engine, though active loans there stood at just $163 million in late May.

COINOTAG’s proprietary 42-indicator composite scoring engine rates the $82.33 resistance at 93/100, the strongest level on our map, driven by the confluence of the daily Pivot Point, the Fibonacci 0.382 retracement and the prior-day high. On the downside, our engine scores the $73.11 support at 71/100, anchored by the Ichimoku Kijun line and the Fibonacci 0.236 level. Derivatives data shows a marginally positive perpetual funding rate of 0.0035% with open interest near $94.98 million — light positioning rather than crowded leverage. With RSI at 59.31, a bullish MACD and a market-wide Fear and Greed reading of 12 (Extreme Fear), a daily close above $82.33 opens $87.03; losing $73.11 would invalidate the recovery thesis.