Chainlink’s decentralized oracle infrastructure has delivered more than 11.5 billion data points onchain and enabled over $9.5 trillion in transaction value throughout the web3 economy. As the industry-standard decentralized computing platform, Chainlink provides a comprehensive set of services that are critical for creating and securing tokenized real-world assets (RWAs) and stablecoins that can scale onchain finance to a billion global users.
A recent Chainlink blog post details seven ways the Chainlink platform functions as a secure, reliable one-stop shop for a broad spectrum of RWA and stablecoin issuers, including leading DeFi protocols such as Paxos and StablR, as well as some of the world’s largest financial institutions, such as ANZ and Vodafone. Below is a short breakdown of five Chainlink services that are critical for accelerating RWA and stablecoin adoption.
Data Feeds
Chainlink Data Feeds deliver accurate, reliable, tamper-proof data regarding tokenized assets onchain. Because Chainlink’s time-tested oracle network has proven secure and reliable, even during adverse and unexpected events such as flash loan attacks, many DeFi protocols will only accept a stablecoin if it has a Chainlink Price Feed.
Functions
Chainlink Functions is a serverless, self-serve web3 development platform that leverages Chainlink oracles to seamlessly deliver offchain web2 data onchain. Functions can enrich tokenized assets with real-world information beyond price data, such as available yields and ownership records.
Automation
Chainlink Automation unlocks one of the most important benefits of tokenized assets: programmability. By using Automation to dynamically trigger preset stablecoin smart contract updates based on offchain data, stablecoin issuers can deterministically define the life cycle of an asset so that users know in advance how the asset will behave. This level of transparency is one of the primary factors driving RWA adoption.
CCIP
As illustrated by Swift’s proof of concept, Chainlink’s Cross-Chain Interoperability Protocol (CCIP) allows traditional financial institutions to transact with a wide range of private and public blockchains using their existing infrastructure. CCIP unlocks new markets and use cases for tokenized assets by allowing them to flow freely between private bank chains and public DeFi applications.
By allowing stablecoins to move between chains seamlessly and on-demand, CCIP eliminates liquidity silos, paving the way for what Chainlink co-founder Sergey Nazarov envisions will become the world’s largest global liquidity layer. Because CCIP can also send data and messages cross-chain, tokenized assets can be programmatically transferred with instructions for how the asset should be handled on the destination chain.
Proof of Reserve
Proof of Reserve (PoR) leverages Chainlink oracles to verify in real time that onchain assets are fully collateralized by cross-chain or offchain real-world assets. This is especially crucial for stablecoins that need to maintain a 1:1 peg to the underlying asset. PoR increases consumer confidence in and adoption of stablecoins by transparently proving onchain assets are fully collateralized at all times and triggering circuit breakers that prevent new stablecoins from being minted if collateral values dip below a certain threshold.
Creating A Golden Record
These key services combined give Chainlink its unique ability to power tokenized assets that serve as an immutable source of truth or a golden record. As Nazarov explained in Chainlink’s 2024 Outlook, “Chainlink is the only platform that can help you generate this golden record, maintain it securely and reliably, and allow it to move and connect it to all the counterparty participants that will buy it.”