Chainlink Powers NAV Data For Sygnum's On-Chain Fidelity Fund

Chainlink is now providing NAV data for Sygnum’s on-chain representation of Fidelity’s Institutional Liquidity Fund.

Chainlink, a web3 oracle network and cross-chain transfer protocol, is enjoying increasing adoption among tradfi institutions bringing assets on-chain.

On July 3, Sygnum, a digital asset bank, announced it is working with Chainlink and Fidelity International, an investment management firm and Bitcoin ETF issuer, to bring Net Asset Value (NAV) data — the calculation of an investment fund’s value — on-chain.

The data will power Sygnum’s tokenized offering of Fidelity International's Institutional Liquidity Fund, a fund investing in aaa-rated investments boasting $6.9 billion in assets. In March, Matter Labs, the company behind ZKsync, a top Ethereum scaling solution, allocated $50 million of the company’s treasury reserves to the fund via Sygnum.

“As we work to bridge the gap between traditional finance and the blockchain industry, setting standards is crucial for fostering ecosystem participation and strengthening collaboration across blockchain companies, regulated financial institutions, and asset managers,” said Fatmire Bekiri, head of tokenization at Sygnum.

“NAV data is a critical building block that underpins the traditional fund industry today,” Chainlink said. “With Chainlink, NAV data can be accurately reported and synchronized on-chain in an automated and secure manner.”

Chainlink said it developed a chain-agnostic method for broadcasting NAV data, allowing the data to propagate across any blockchain.

The price of Chainlink's LINK token is down 2.4% in the past 24 hours, according to CoinGecko.

Tradfi institutions explore tokenization

The announcement comes as an increasing number of mainstream institutions are exploring tokenization, many of which are turning to Chainlink to provide on-chain data and cross-chain interoperability.

In May, the Depository Trust & Clearing Corporation (DTCC) published its findings from a pilot distributing NAV data for mutual funds across blockchains conducted in partnership with Chainlink and 10 major financial institutions.

Chainlink’s cross-chain interoperability protocol (CCIP) has also formed a key component of tokenization pilots launched by the likes of BNY Mellon, Citi, BNP Paribas, ANZ Bank, Lloyds Banking Group, and SIX Digital Exchange.

“Fund tokenization is likely the largest digital asset trend happening today, and it is a large confirmation that global asset management firms are entering this growing market,” said Sergey Nazarov, Co-founder of Chainlink. “The global reach and efficiency benefits of tokenized funds are far greater than traditional methods and will over time become the way the entire asset management industry operates.”

According to Rwa.xyz, the value of tokenized U.S. treasuries, bonds, and cash equivalents has ballooned in 2024. The sector currently boasts a $1.77 billion market cap after growing more than 120% since the start of the year.