Grayscale has asserted that Chainlink will play a pivotal role in the next major wave of blockchain adoption, dubbing the project as the ‘critical connective tissue’ binding cryptocurrency with traditional financial systems.
In a recent research report, Grayscale proposed that Chainlink (LINK) is built to serve as crucial infrastructure supporting tokenization, cross-chain settlements, and the transition toward real-world assets linked with blockchain technology.
“A more accurate description of Chainlink today would be modular middleware that lets on-chain applications safely use off-chain data, interact across blockchains, and meet enterprise-grade compliance needs,” Grayscale stated.
The firm noted that Chainlink’s extended capabilities have elevated LINK to the status of the largest non-layer 1 cryptocurrency by market capitalization (excluding stablecoins), offering investors access to diverse ecosystems instead of a singular blockchain.
Chainlink’s Role in Boosting Tokenization
Grayscale contends that tokenization is the most significant area where Chainlink’s value becomes apparent. Presently, a vast majority of financial assets, ranging from securities to real estate, are recorded on off-chain ledgers. For these assets to harness the efficiency and programmability of blockchain, they must undergo processes of tokenization and verification, integrating with external data sources.
“We expect Chainlink to play a central role orchestrating the process of tokenization, and it has announced a variety of partnerships, including with S&P Global and FTSE/Russel, that should help it do so,” the asset manager wrote.
The market for tokenized assets has surged from $5 billion to more than $35.6 billion since early 2023, according to RWA.xyz.
Total RWA onchain. Source: RWA.xyz
Chainlink, JPMorgan, and Ondo’s Joint Settlement
In June, Chainlink, along with JPMorgan’s Kinexys network and Ondo Finance, successfully executed a cross-chain delivery versus payment (DvP) settlement between a permissioned bank payment system and a public blockchain testnet. This pilot linked the Kinexys Digital Payments network, a JPMorgan initiative, with the Ondo Chain’s testnet dedicated to tokenized real-world assets. Utilizing Chainlink’s Runtime Environment (CRE) as the coordinating layer, the settlement facilitated the exchange of Ondo’s tokenized US Treasuries fund, OUSG, for fiat payments without moving the assets from their original blockchains.
