Chainlink, Fidelity, and Sygnum Boost TradFi on Blockchain

Chainlink has announced a partnership with Fidelity International and global digital asset banking group Sygnum, aimed at bringing Net Asset Value (NAV) data on-chain.

Chainlink, Fidelity, Sygnum Collaborate to Bring NAV Data On-Chain

Chainlink has announced a partnership with Fidelity International and global digital asset banking group Sygnum to bring Net Asset Value (NAV) data on-chain.

According to a Wednesday, July 3, 2024 release, the alliance will enhance transparency and accessibility of asset data, providing a major boost to the growing field of fund tokenization.

The collaboration will use Chainlink Network’s ability to work across different blockchains and its real-time data updates to ensure that NAV data is accurately reported and updated both on the blockchain and other systems. Chainlink will also offer a flexible method for sharing NAV data, allowing it to securely spread across any blockchain or existing off-chain system.

We’re excited to announce that Fidelity International and Sygnum have partnered with #Chainlink to provide NAV data onchain for Fidelity International’s $6.9B money market fund.

This is a landmark production use case for tokenized assets 🧵https://t.co/dfQ3Shgx6f pic.twitter.com/o0sT4JOQNj

As part of the initiative, Sygnum has issued an on-chain representation of Fidelity International’s $6.9 billion Institutional Liquidity Fund. Additionally, Sygnum has tokenized $50 million of Matter Labs’ company treasury reserves held in Fidelity International’s money market fund, issued on the ZKsync blockchain as part of the Chainlink SCALE program.

Chain Link co-founder Sergey Nazarov highlighted the significance of the collaboration in bridging the gap between traditional finance and the blockchain industry.

“This collaboration showcases how Chainlink is enabling a critical bridge between traditional finance and the blockchain industry, ultimately driving the integration of tokenized assets into the broader financial ecosystem,” said Nazarov.

Experts Bet on Tokenization As the Next Big Thing

A May 2024 report by financial analytics firm S&P Global has highlighted the significant momentum in tokenized assets, asserting their potential to transform the existing financial markets.

S&P Global emphasized the key benefits attached to tokenized funds over traditional treasuries, such as greater liquidity and streamlined fund settlement. The firm added that tokenized treasuries are particularly witnessing heightened momentum, evidenced by their accelerated growth to over $1 billion in outstanding value.

Mainstream financial institutions are increasingly recognizing the benefits of tokenized assets. Notable examples include Blackrock’s BUIDL fund, which was introduced in March this year and attracted over $240 million in investments within the same week of launch. BUIDL currently stands at $381 million, is built on the Ethereum blockchain, and allows investors to directly redeem their shares for USDC stablecoin.

Franklin Templeton’s FOBXX fund has similarly enabled peer-to-peer transfers of tokens on Stellar and Polygon blockchains, showcasing the growing acceptance of tokenized treasuries in the financial ecosystem.

On the Flipside

Why This Matters

The collaboration between Chain Link, Fidelity International, and Sygnum marks a significant step forward in integrating traditional finance with blockchain technology, paving the way for increased adoption and innovation across the asset management industry.

Discover more about the recently published report on tokenization in this article:

Tokenized Treasuries Will Bring TradFi On-Chain: S&P Global

Regulatory standards for the local Nigerian crypto industry may be taking a U-turn; read this article to find out more:

Crypto in Nigeria Gets a Second Look as SEC Softens Stance