BlockBeats report: On June 26, insiders said that cryptocurrency trading platform Kraken’s parent company Payward is in talks with the decentralized lending protocol Aave. It plans to exchange 35,000 ETH for 250,000 AAVE tokens and 15% common equity in Aave Group. The overall valuation is about $385 million, and the transaction value is about $71 million. Insiders also said Kraken is seeking joint financing for the deal at the same time.

This investment has been positioned as the first in a series of transactions for Payward’s asset management business expansion, marking Kraken’s move toward a more proactive role in DeFi and other investment areas. Insiders said Payward is well-backed with ample capital, and there are already partners interested in participating in opportunities of this kind.

Aave is currently the largest decentralized lending protocol by scale, but this year in April it fell into one of the most severe crises in DeFi history: hackers exploited a KelpDAO cross-chain bridge vulnerability to mint approximately $292 million in uncollateralized rsETH, then used it as collateral on Aave to borrow real assets—resulting in the protocol accumulating $190 million to $230 million in bad debt. Although Aave’s own smart contracts were never breached, the incident triggered the withdrawal of more than $8 billion in deposits, highlighting the cascading risks created by interconnectedness across the DeFi ecosystem.

Kraken has been making frequent acquisition moves lately. It previously announced in April that it would acquire crypto derivatives exchange Bitnomial for a top bid of $550 million, and, according to reports, it is pursuing a new funding round at a $20 billion valuation—actively laying the groundwork for a potential IPO.