Chainlink (LINK) rallied by 16% overnight after publishing research on collaboration with top finance industry companies. LINK traded at $16.43, extending the gains from previous weeks. The potential partnerships boost Chainlink as the go-to provider of data to link multiple blockchains with traditional finance.
Chainlink issued a pilot report on bringing trusted financial data to the blockchain ecosystem, in partnership with DTCC, a market infrastructure provider.
Until recently, Chainlink was considered a prime candidate to boost tokenization of real-world assets (RWA). However, the report is more specific about Chainlink’s connection to some of the leading financial industry bodies.
Source: Smart NAV report
Among the testers of the new Smart NAV service was J.P.Morgan, known to be involved with the BlackRock Bitcoin ETF. Initially skeptical about crypto, J.P. Morgan found itself in the middle of the new technology, even working on its own custodial and transaction solutions. Now, J.P. Morgan has also joined the expansion of oracles between traditional trading and blockchains.
Chainlink Brings Funds, Stock Data to the Blockchain
The direction of data flow in the Smart NAV report is from funds and external data to multiple blockchains. Chainlink has the ability to provide chain-agnostic services, sending data to contracts on any existing blockchain.
Chalinlink’s Smart NAV service will extend the existing DTCC facility, Mutual Fund Profile Service I, the financial industry standard for sending out rate and price information.
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The main use cases identified by DTCC are that blockchain projects would be able to launch tokens based on mutual funds, as well as run bulk smart contracts with data from multiple funds. DTCC provided the official, timely and verifiable data, while also serving as a governor of the products that used the data.
DTCC also noted that Chainlink’s presence could secure a single interface layer, where all blockchains could seek data, instead of further fragmenting the blockchain industry.
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Chainlink will transform the legacy data of DTCC in modern JSON format. DTCC will sign the new batch of data with its private key, then distribute the information across blockchains. In the initial testing, only DTCC could distribute the data, but with wider application, Chainlink may offer the same toolset to multiple blockchains.
There is no set date for the release of Smart NAV to new platforms. But the introduction of the official tool could boost decentralized finance and offer more assets tied to the value of the traditional financial system. Moreover, the data would be verified and reliable, with no possibility of tampering.
The data test also means Chainlink has the potential to connect the legacy banking sector to blockchains, removing the need to integrate each project separately and potentially setting a unified standard.
So far, projects like Ripple and Stellar have tested collaborations with banks. But Chainlink expands the possibilities for tokenization and investments.
LINK Tokens Await Bigger Breakout
LINK managed to abandon previous lows, while also going through accumulation at the lower price range. The Chainlink project has always enjoyed a community of loyal holders, and a significant part of the supply is locked for staking.
Despite the positive news, LINK tokens still need to battle resistance on the markets.
In the past weeks, LINK has produced similar rallies, which were abandoned due to lack of momentum. This time, expectations of a rally are stronger, potentially taking LINK to the $30 range.
Cryptopolitan reporting by Hristina Beeva.
