[TEMP CHECK] Onboard kBTC to Aave V3 Core Instance
Author: ACI (Aave Chan Initiative)
Date: 2026-01-09
Summary
This TEMP CHECK proposes the onboarding of Kraken’s kBTC token into the Aave V3 Core Instance.
Motivation
kBTC, the wrapped Bitcoin token offered by Kraken, a well-established and regulated platform in the cryptocurrency space, is already available and fully operational across multiple networks. As a trusted centralized entity, Kraken’s introduction of kBTC to the wrapped Bitcoin market delivers a compelling value proposition for the Aave ecosystem.
This new asset will diversify the options available for Bitcoin holders looking to participate in DeFi activities on Aave v3. The introduction of kBTC to Aave v3 will provide users with more choices for utilizing their Bitcoin holdings, increasing liquidity and engagement within the protocol.
Moreover, integrating kBTC aligns seamlessly with Aave’s dedication to providing a diverse selection of premium assets. It allows users to leverage Kraken’s deep liquidity and strong reputation while accessing Aave’s proven lending and borrowing features. This partnership between a major centralized exchange and a premier DeFi protocol has the potential to draw in more mainstream participants to Aave, driving greater growth and broader adoption of the platform.
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A large institution has expressed strong intent to actively utilize the Aave protocol on Ethereum mainnet by borrowing GHO and other stablecoins to support their liquidity and trading operations. This engagement is expected to generate meaningful net new revenue for the Aave DAO through borrow interest.
kBTC will leverage Aave V3.6 features, the configuration will set kBTC as collateral-only and GHO/USDC as borrow-only, creating direct kBTC <> GHO/USDC borrowing pairs that drive stablecoin demand and prioritize GHO minting for organic growth.
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Specification
Risk Parameters will be provided by Risk Service Providers and proposal will be updated accordingly at ARFC stage.
Next Steps
- Publication of TEMP CHECK to gather community & service providers feedback, and escalate to TEMP CHECK Snapshot.
- Publication of a standard ARFC, if TEMP CHECK Snapshot passed, to continue collecting community & service providers feedback before escalating proposal to ARFC snapshot stage.
- If the ARFC snapshot outcome is YAE, publish an AIP vote for final confirmation and enforcement of the proposal.
Disclaimer
ACI is not presenting this proposal on behalf of any third party and is not compensated for creating this proposal.
Copyright
Copyright and related rights waived via CC0.