Aave logo displayed on a smartphone screen. Source: Rafael Henrique - stock.adobe.com

Key Takeaways:

Aave community approved licensing a centralized version of Aave v3 for Kraken’s Ink blockchain with 99.8% support.
The partnership aims to boost Aave’s presence in institutional lending, with revenue-sharing terms benefiting the Aave DAO.
Ink Foundation plans to support the launch with over $250 million in early liquidity incentives.

Aave’s community has overwhelmingly approved a proposal to license a centralized version of its lending protocol for deployment on Kraken’s Ink blockchain.

The offchain vote, presented as an Aave Request for Comment (ARFC), received 99.8% “YAE” support and will move forward as an Aave Improvement Proposal (AIP) for onchain voting.

Kraken, via Ink, will offer onchain loans to their users through a white-labeled Aave market operated by Ink.

Aave's infrastructure will be utilized for onchain loans, using Aave as a DeFi mullet.https://t.co/dYkKpixuTI
— Stani.eth (@StaniKulechov) July 20, 2025

This initiative aims to launch a whitelabel version of Aave v3 on Ink – Kraken’s compliant layer-2 network focused on institutional DeFi and tokenized assets.

The proposal presents this as an opportunity to expand Aave’s influence in the institutional lending market while generating new revenue streams.

The Aave DAO will receive a share of at least 5% of borrow volume from all pools.

The Ink Foundation is backing the initiative with liquidity mining incentives designed to onboard over $250 million in early supply to the new instance.

While Aave’s total value locked (TVL) peaked at $40.3 billion in May 2025, it has since dipped to $33.5 billion, based on data from DeFiLlama – placing it just behind Lido, which holds $34.3 billion.

This move marks a strategic shift for Aave as it blends its decentralized roots with institutional demand.