The Chainlink Runtime Environment (CRE) is a flexible, modular, chain-agnostic computing environment that makes it faster and easier to build decentralized applications that are compatible with existing financial systems. Using cryptographic tools such as zero-knowledge proofs and trusted execution environments, CRE allows institutions to bring financial services onchain while protecting users’ private data.
Today, Chainlink alongside Kinexys by J.P. Morgan, the financial services firm’s blockchain business unit, and Ondo Finance, a leader in real-world asset (RWA) tokenization, announced the success of a cross-chain delivery versus payment (DvP) test transaction powered end-to-end by CRE.
The transaction demonstrated settlement of Ondo Finance’s flagship tokenized U.S. Treasuries Fund (OUSG) with J.P. Morgan’s permissioned Kinexys Digital Payments network on Ondo Chain, a layer-1 built to scale RWA tokenization, facilitated by CRE’s secure cross-chain orchestration layer.
The novel DvP solution establishes how assets and payments can be exchanged simultaneously cross-chain, reducing counterparty and settlement risk by averting system fragmentation and manual workflows that make TradFi DvP transactions difficult to execute while costing market participants more than $914 billion over the past decade.
“By securely and thoughtfully connecting our institutional payments solution with both external public and private blockchain infrastructures seamlessly, we can offer our clients and the broader financial ecosystem a wider range of benefits and scalable solutions for settling transactions,” said Nelli Zaltsman, Head of Platform Settlement Solutions at Kinexys by J.P. Morgan, in an official announcement.
“The demonstrated cross-chain solution is a testament to what can be achieved through strong collaboration across diverse segments of the Web3 ecosystem, and we are pleased to have worked with Ondo and Chainlink to bring this to life as the first transaction on Ondo Chain testnet.”
“The debut transaction on Ondo Chain’s testnet with both Kinexys by J.P. Morgan and Chainlink isn’t just a major milestone, it’s a statement about the future of finance,” added Nathan Allman, CEO of Ondo Finance.
“We’re thrilled to collaborate with two of the most influential players in crypto and traditional finance to demonstrate the power of compliant, scalable blockchain infrastructure for real-world assets.”
During last year’s SmartCon, Chainlink co-founder Sergey Nazarov underscored CRE’s potential to accelerate TradFi’s web3 adoption the way COBOL automated finance in the 1950s and JRE brought finance online in the 1990s.
He indicated Chainlink’s collaboration with Kinexys by J.P. Morgan and Ondo Finance is a “clear sign” that TradFi and DeFi have already begun to converge.
“Chainlink has been built to enable the secure and reliable execution of institutional-grade transactions just like this, across multiple blockchains and with the compliance required by large institutions like J.P. Morgan,” he said.
“It is becoming increasingly clear to the world’s institutions that they have a large addressable market in the public chain community and that they need a reliable set of technical standards and cross-chain connection capabilities to successfully transact in this new world.”