Story from

Sergey Nazarov On How Chainlink Unlocks The Full Benefits Of Tokenization

During this year’s Token2049 in Dubai, Chainlink co-founder Sergey Nazarov sat down with The Defiant to discuss the numerous benefits of real-world asset tokenization and its growing impact on traditional finance.

As the industry-standard decentralized computing platform, Chainlink has enabled over $12 trillion in transaction value and provides a comprehensive set of services that are critical for creating and securing tokenized assets throughout the multi-chain economy.

Beyond enabling atomic settlement and the ability to manage collateral more efficiently, Chainlink-powered tokenized assets can serve as a unified golden record that combines ownership rights and vital data about the underlying asset into a single continuously updated smart contract.

“If something changes about the asset, the onchain record reflects that,” Nazarov said. He explained how the ability for anyone to understand the status of an asset in real time benefits both individuals and the entire financial system.  

“If you look at the systemic financial system failures, what they basically boil down to is information asymmetries, where one group like the asset issuer was very educated about the asset. They knew that the underlying mortgages were not good, so they didn’t buy them, but they sold them.”

Reiterating his stance that virtually all of the world’s value will be reformatted into a superior state onchain, Nazarov said Chainlink is providing the fundamental infrastructure for a “monumental shift” in how the world works. 

Chainlink’s Cross-Chain Interoperability Protocol (CCIP) unlocks new markets and use cases for tokenized assets by allowing them to flow freely between private bank chains and public DeFi applications, ultimately providing a single standard by which traditional finance and web3 can merge into a global internet of contracts.

Nazarov explained why CCIP is one of tokenized assets’ key building blocks in a world where individual banks and asset managers will inevitably create their own chains. Without a single blockchain interoperability standard, liquidity fragmentation would make it impossible for such assets to succeed.

“Even if you make a successful real-world asset or token on one of those bank chains and you’re not connected to all the chains that have the liquidity, you’re not going to get the purchasing power; you’re not going to get the success that you’re looking for,” he said.

“That is really where all this is going – it’s going to a single global internet of contracts where all of the public chains and all of the private chains are interconnected with each other, and if a high-quality asset appears on any one of them, they can all interact with it in a compliant, high-speed, secure way.”

Watch the full interview.

Read more about

Have an idea for a story?

If you’re interested in submitting content to be considered for publication, please carefully review the Chainlink Today Content Submission Guidelines to help you get started. We’re excited to hear from you.

Related Stories