The list of projects on a Chainlink blog page could have come off of an international banking and capital markets directory. There are names of infrastructure operators (Swift, Euroclear), banks (ANZ, Bancolombia, Emirates NBD) and asset managers (Fidelity International, Sygnum), as well as blockchain initiatives of Germany’s Börse Stuttgart (BX Digital and BX Swiss).
Those are just a sampling of the partnerships with which Chainlink, a self-described “standard for onchain finance,” is involved in addressing “mission-critical financial systems” as they evolve toward tokenization and decentralized finance (DeFi).
With the Swift international financial communications cooperative and UBS Asset Management, Chainlink announced last November completion of a pilot for settling tokenized fund subscriptions and redemptions using the Swift network. That fell under the umbrella of the Monetary Authority of Singapore’s Project Guardian alongside a host of other global participants.
Swift said it was the latest demonstration of “how its infrastructure can provide a secure, scalable way for financial institutions to connect to multiple types of blockchain.”
“Chainlink is enabling institutions to re-use Swift's infrastructure to facilitate payments for digital asset transactions,” said Sergey Nazarov, co-founder of Chainlink, which has facilitated well over $19 trillion in total transactions as a blockchain-connecting oracle.
Earlier last year, Depository Trust & Clearing Corp. reported on the Smart NAV (net asset value) pilot, collaborating with Chainlink on extending DTCC’s mutual fund services – including risk management capabilities – for market participants including BNY, Franklin Templeton, JPMorgan and State Street.
Also making use of Chainlink are crypto-asset players such as Coinbase, Fireblocks and Ripple.
Co-founder Nazarov envisions an internet of contracts with decentralized finance services and capital markets infrastructure connections, as explained in a January business review and preview posted online.
In 2024, “a pivotal year for the crypto industry,” Nazarov said, “we continued to solidify our lead in powering the majority of DeFi. We also saw a huge amount of adoption in the capital markets.”
Sergey Nazarov
He added that “multiple central banks and governments started working with Chainlink in various dimensions to build a global financial system that runs on the Chainlink standard. The value of the Chainlink standard for the global financial system is that it creates highly reliable agreements and transactions that are fundamentally better than what currently exists.”
Given the reality that legacy financial technologies “won’t be going away because banks and asset managers heavily rely on them,” Nazarov said, “we must seamlessly integrate these existing technologies with onchain systems.”
Chainlink capital markets director Ryan Lovell analogizes to the conversion in building materials from wood to steel: “We say, ‘Don’t change your woodworking material at all.’ We make the woodworking material compatible to steel, and it de-risks the entire thing. We can connect you to the steel manufacturing.”
Lovell also likens the path to “internet of contracts” to the transformation of the auto industry from self-contained assembly lines to complex supply chains.
“It's suppliers with their own proprietary way of doing it better than you could,” Lovell explains. “This speaks to the globalization of how things are made, and the asset management industry is no different.”
Swift has been around since the 1970s, and its well-established standards don’t have to be discarded. “Blockchains are just a new marketplace and a new way of doing business. We extended the connectivity of Swift’s existing network into that.”
Chainlink offers its Cross-Chain Interoperability Protocol (CCIP) as a basis for developers to build secure applications to transfer tokens, messages and data across chains. It supports cross-chain lending, computing transactions, optimizing yields and creating decentralized applications.
CCIP Cumulative Transfer Volume through March 2025.
Research and development is centered in Chainlink Labs. Lovell describes it as similar to the separate foundation arms of the Ethereum and Cardano blockchains. The labs division “essentially listens to the market and comes up with a roadmap to build products that are facilitating the growth of the ecosystem,” Lovell says.
Positioning itself as a supplier of certain services for the financial industry, Chainlink in October launched Chainlink Runtime Environment – a unified, modular, chain-agnostic computing environment that is said to make it faster and easier to build decentralized applications compatible with existing financial systems.
Demonstrating its support of compliance, Chainlink last fall worked on a cross-border transaction, involving stablecoin and commercial paper, between firms in Australia and Singapore. This required connecting two different blockchain ecosystems. Because the digital-asset technology is composable and programmable, code can be adjusted to address compliance and documentation issues in the ordinarily problematic cross-border setting, according to Lovell.
“CSA [credit support annex] agreements have rules for transactions in derivatives, what's eligible for collateral, how it will be valued, and the timing in which it's transferred – all these paper-based rules,” he says. “If you put legal, regulatory and operational limits in code, it’s very powerful and more instant.
“Typically when something goes wrong [with paper], you have to peel out a legal item, interpret it and figure out what happened. But by then, someone went bankrupt or something spiraled out of control.”
Similarly, in delivery versus payment (DVP), Chainlink can coordinate across blockchains when the two sides of a transaction are on different platforms. If a firm has digital assets but not stablecoins or central bank digital currency, it will need help coordinating those for DVP.
“These blockchains aren't just systems. They are communities,” Lovell says, each adopting a set of preferences and potentially creating fragmentation across the market. “There are islands of liquidity, and we’re connecting it all.”
Chainlink supports the verifiable LEI, an enhancement to the financial services industry’s legal entity identifier to enable interaction with digital and tokenization platforms.
The Global Legal Entity Identifier Foundation is considering interoperability with Chainlink’s CCIP. GLEIF chief executive officer Alexandre Kech said in November that it was looking into interoperability “at asset level, so that an asset issued on one blockchain can be used on another blockchain.”
Chainlink can be leveraged for the digital identity goals that GLEIF is pursuing.
“I'm not going to promise you that next year, everybody's going to use it,” Kech said. “It's going to take the time it needs to take . . . Hopefully it will be faster” than the 16 years that it took blockchain to reach its current state.
“In the next five years, we will see the vLEI becoming one of the prominent ways of identifying organizations on digital platforms, and one of the main verifiable systems to issue credentials.”
Nazarov, meanwhile, believes tokenized real-world assets have taken early steps toward becoming a $100 trillion market. Given the open-source availability of blockchain technology, the United States’ potential advantage lies in its “very strong domestic market and the ability for it to create these highly reliable financial assets,” Nazarov said in a March interview with Cointelegraph at the Digital Asset Summit in New York – days after he participated in the White House Crypto Summit. “And this is what I think the administration and the people in the legislature are now starting to understand.”