TLDR
- Payward, Kraken’s parent entity, is negotiating to acquire a 15% ownership position in Aave for approximately $71 million
- The proposed transaction involves exchanging 35,000 ETH for 250,000 AAVE tokens plus equity shares
- At $385 million, the suggested valuation represents approximately 70% less than Aave’s complete diluted market capitalization
- Founder Stani Kulechov publicly rejected the offer, stating AAVE won’t accept such a steep discount
- The proposal follows Aave’s recovery period after the KelpDAO security breach caused withdrawals exceeding $8 billion
Major cryptocurrency platform Kraken is pursuing discussions to acquire a significant ownership stake in Aave, Ethereum’s premier decentralized finance lending platform. According to reports, the transaction would establish Aave’s worth at $385 million.
The contemplated arrangement would have Payward, Kraken’s corporate parent, contribute 35,000 ether tokens in return for 250,000 AAVE governance tokens alongside a 15% common equity position in Aave Group.
The complete transaction carries an estimated value of roughly $71 million. Industry sources indicate Kraken is simultaneously exploring partnerships with additional investors to support the funding.
Strategic Implications for Payward
This prospective acquisition represents an opening move in Payward’s broader strategy to establish Payward Asset Management. According to insiders familiar with the situation, the company aims to increase its involvement in decentralized finance ventures and related investment platforms.
Kraken has pursued aggressive expansion strategies in anticipation of a potential initial public offering. Earlier this year in April, Payward announced plans to acquire Bitnomial, a cryptocurrency derivatives trading platform, in a deal valued at up to $550 million that includes comprehensive US CFTC regulatory approvals.
Separate reports from May indicated Payward was conducting fundraising activities targeting a $20 billion company valuation.
Founder Challenges Proposed Terms
Stani Kulechov, who founded Aave, took to social media platform X to address the speculation, emphatically stating there is “NO WAY” the protocol would accept such a heavily discounted valuation.
The suggested $385 million price point falls substantially short of the AAVE token’s total diluted market value. Kulechov highlighted that Aave currently produces $134 million in yearly revenue, with all proceeds directed to the Aave DAO treasury.
While rejecting the valuation terms, he didn’t rule out potential token sales by Aave Labs, the commercial entity supporting the protocol. “Aave Labs owns an allocation of AAVE that multiple market participants have discussed purchasing,” Kulechov stated.
Kulechov further criticized the original reporting as containing inaccuracies and misrepresentations.
Navigating Through 2026 Challenges
These negotiations emerge while Aave continues rebuilding following a devastating security incident earlier this year. During April, cybercriminals believed to be associated with North Korea’s Lazarus Group successfully compromised KelpDAO’s cross-chain infrastructure, generating approximately $292 million in fraudulent tokens.
The attackers subsequently deposited these worthless assets as loan collateral within Aave’s platform and withdrew legitimate cryptocurrency against them. After the collateral’s value collapsed, Aave faced bad debt estimates ranging between $190 million and $230 million.
While Aave’s core smart contract infrastructure remained secure throughout the incident, the aftermath nonetheless sparked withdrawals surpassing $8 billion from the protocol’s total value locked.
In response, Aave has introduced an enhanced risk management framework and deployed the fourth iteration of its protocol architecture. Kulechov successfully advanced his “Aave Will Win” governance initiative in April 2026, restructuring protocol economics to channel all revenue toward the Aave DAO and token stakeholders.
He also revealed that Aave Labs is currently developing “Aavenomics 3.0,” featuring an innovative automated token buyback system for AAVE.
Neither Kraken nor Aave representatives have officially acknowledged ongoing deal negotiations.
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