TLDR
- Tydro uses Aave v3’s technology to power DeFi lending on the Ink network.
- INK token rewards users and supports liquidity for the Tydro platform.
- Kraken plans to integrate Tydro with its main exchange for DeFi access.
- Tydro will support wETH, kBTC, and stablecoins like USDT0 and GHO.
Ink, the Ethereum Layer 2 network developed with support from Kraken, has unveiled Tydro, a decentralized lending and borrowing protocol built as a white-label version of Aave v3. The new platform will integrate the INK token to support liquidity and user rewards, serving as a foundational layer for decentralized finance (DeFi) activities on the Ink network.
Launch of Tydro and Its Role on Ink
The Ink Foundation announced the rollout of Tydro, describing it as “core infrastructure for DeFi on Ink.” The protocol is designed to enhance liquidity within the Ink ecosystem by enabling decentralized lending and borrowing for digital assets.
According to the foundation, Tydro leverages Aave’s established technology stack while introducing an INK-based incentive model. This model is aimed at driving participation from users and developers who wish to build on the network. Kraken confirmed that it plans to connect Tydro to its centralized exchange, allowing clients to engage with DeFi services directly from Kraken’s main platform.
A spokesperson said the integration would “enable clients to more seamlessly access DeFi opportunities” while maintaining Kraken’s existing security standards. The move could bring more users to the Ink network and increase utility for the INK token.
Token Utility and User Incentives
The INK token will play a central role in supporting liquidity for Tydro. Users who participate in lending and borrowing activities will earn INK rewards and points tied to a future airdrop. A representative for the initiative said, “Tydro users will accumulate points that represent claims on the first airdrop down the line.”
When the Ink Foundation first introduced the INK token, it stated that the token would not be used for governance decisions. Instead, INK would serve as a tool for liquidity aggregation and to reward early adopters of Ink-based decentralized applications. The token’s design focuses on promoting activity within the network rather than influencing protocol decisions.
Since the announcement of the INK token, total value locked (TVL) on Ink has increased, reaching levels near $140 million, according to Dune Analytics. The foundation views Tydro as the next phase of growth, expanding DeFi access on the network.
Supported Assets and Future Expansion
At launch, Tydro will support several key assets, including wrapped Ethereum (wETH), Kraken’s wrapped bitcoin (kBTC), and multiple stablecoins. Supported stablecoins include the Global Dollar-issued USDG, Tether-backed USDT0, and Aave’s native stablecoin GHO.
The platform also plans to add yield-bearing and liquid staking tokens in future updates. These additions are expected to enhance market depth and create more opportunities for users to earn yields within the Ink ecosystem.
Aave, the protocol on which Tydro is based, currently secures over $75 billion in net deposits and facilitates $30 billion in active loans. It remains the largest onchain lending protocol, representing more than half of all onchain lending activity.
Broader Market Context and Kraken’s Strategy
Kraken’s involvement in Ink continues to reflect its broader strategy to integrate DeFi within traditional exchange services. The exchange recently shared plans to include INK in its main product suite and its “Kraken Drops” airdrop program. The firm has also suggested it could go public as early as the first quarter of 2026.
Meanwhile, competitor Coinbase has expanded decentralized trading through its app, allowing users to access Base-based assets via liquidity sources such as 1inch and 0x. The evolving landscape shows growing competition among exchanges to bridge centralized and decentralized finance.
As Ink launches Tydro, it strengthens its position as a key DeFi layer for Ethereum users seeking scalable and integrated financial tools within the Kraken ecosystem.
