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Chainlink Price Surges 20% as Tokenization Pilot Sees Wall Street Embrace LINK

Last Updated May 17, 2024 12:53 PM
Teuta Franjkovic
Last Updated May 17, 2024 12:53 PM
By Teuta Franjkovic
Verified by Peter Henn

Key Takeaways

  • Chainlink surged after a successful tokenization pilot with US financial institution DTCC.
  • The pilot, involving Wall Street firms, used Chainlink’s technology to bridge traditional finance and blockchain.
  • This marks a major milestone towards integrating blockchain into mainstream finance.

The LINK token from Chainlink surged up to 20%  following the announcement  that DTCC, the largest US settlement and clearing house, successfully completed a tokenization pilot.

This pilot involved major Wall Street firms, such as JP Morgan and BNY Mellon, and used Chainlink’s Cross-Chain Interoperability Protocol (CCIP).

Chainlink Surges Past $16, Triggering Massive Short Liquidations

Chainlink, a decentralized oracle network established in 2017, provides external data to and across different blockchains. As of the latest updates , Chainlink has surged past $16, reaching a new monthly peak, although it remains below its March high of $21.64.

This increase sparked the liquidation of $1.68 million in short positions  over the last 24 hours.

Chainlink price
Credit: CoinMarketCap

For context, that’s more liquidations than many of its larger market cap rivals, such as Dogecoin. The largest memecoin by market cap, has a $22 billion market cap  compared to Chainlink’s $10 billion—more than twice its size. However, short liquidations for Chainlink in the past day exceed the combined liquidations for both short and long positions in DOGE.

DTCC and Chainlink Pilot Proves Potential of Tokenized Funds on Public Blockchains

The recently concluded DTCC pilot, Smart NAV , aimed to test a method for Wall Street institutions to make mutual fund data, such as prices and rates, available on public networks in a way that could operate across blockchains. This was achieved through CCIP.

According to DTCC, the project wants is to continue “advancing the tokenization of assets”.

The pilot demonstrated that, by delivering structured data on-chain and creating standard roles and processes, foundational data could be put into various on-chain use cases . These included tokenized funds and bulk consumer smart contracts, which hold data for multiple funds.

This can support future industry development and power new uses, such as brokerage portfolio applications. Additional benefits include real-time, more automated, data dissemination and built-in access to historical data.

Chainlink Takes Wall Street Data to Public Blockchains

Wall Street firms have long shown interest in blockchain technology but have often hesitated to operate on public blockchains. In 2023, many of the firms mentioned in Chainlink’s announcement, along with others like Microsoft  and Goldman Sachs, joined the Canton Network .

How are Chainlink and Microsoft Working Together? 
byu/uxsequence  inChainlink 

This network was a pilot, not public, designed for large institutions to test the feasibility of decentralized infrastructure.

The new test with Chainlink is different. This is because its goal is to obtain Wall Street data directly from the institutions and make it available for use by smart contracts and other Real World Asset (RWA) protocols on public networks.

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