Grayscale Names Chainlink Key to Blockchain Tokenization Boom

Chainlink: Bridging Traditional Finance and Crypto Through Tokenization and Cross-Chain Settlement Innovations

  • ChainLink is positioned as central middleware linking crypto with traditional finance through off-chain data and cross-chain interactions.
  • Its software tools support tokenization, cross-chain settlements, and compliance for real-world assets on blockchains.
  • The tokenized asset market grew from $5 billion to over $35.6 billion since early 2023, highlighting Chainlink’s role in the sector.
  • Chainlink, JPMorgan, and Ondo Finance completed a cross-chain delivery-versus-payment settlement connecting a bank payment system with a public blockchain.

Grayscale emphasizes that Chainlink will play a critical role in the next phase of blockchain adoption. Described as the “critical connective tissue” linking crypto to traditional finance, Chainlink provides modular middleware that allows on-chain applications to access off-chain data securely, communicate across blockchains, and fulfill enterprise compliance requirements. This growing infrastructure has elevated Chainlink (LINK) to become the largest non-layer 1 crypto asset by market capitalization, giving exposure to multiple blockchain ecosystems.

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Tokenization stands out as a clear use case where Chainlink adds value. Most financial assets, including securities and real estate, remain recorded on off-chain ledgers. For these assets to benefit from blockchain’s efficiency and programmability, they need to be tokenized, verified, and linked to external data sources. According to a research report, Chainlink is poised to orchestrate this tokenization process and has formed partnerships with major data providers such as S&P Global and FTSE/Russel. The tokenized asset market has expanded from $5 billion to over $35.6 billion since early 2023 according to RWA.xyz.

In June, Chainlink, JPMorgan’s Kinexys network, and Ondo Finance finalized a cross-chain delivery-versus-payment (DvP) settlement. This pilot connected the permissioned bank payment network Kinexys Digital Payments with Ondo Chain’s testnet, which focuses on tokenized real-world assets. Using Chainlink’s Runtime Environment (CRE) as the coordination layer, the transaction exchanged Ondo’s tokenized U.S. Treasurys fund (OUSG) for fiat payment, with assets remaining on their native blockchains. This event demonstrates Chainlink’s capacity to enable seamless interactions between traditional financial systems and public blockchains.

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