DTCC Pilot Project with Chainlink Leverages Blockchain Data to Expand Fund Tokenization

Share this article

The Depository Trust and Clearing Corporation (DTCC), the world's largest securities settlement system, has completed a pilot project called Smart NAV in collaboration with blockchain Oracle Chainlink (LINK). Major financial institutions from the US also participated in the pilot.

According to a report published by DTCC, the pilot was launched to establish a standardized process for retrieving and distributing net asset value (NAV) financial data across multiple blockchains. Through standardization, tokenization will become easier and more efficient over time.

The Smart NAV pilot, which included participants such as JPMorgan, Franklin Templeton, BNY Mellon and State Street, explored the digital extension of DTCC's Mutual Fund Profile Service (MFPS I) to use distributed ledger technology (DLT) for data distribution and consumption.

By delivering structured data onchain and creating standard roles and processes, the pilot found that basic data can be incorporated into various on-chain use cases such as tokenized funds and “bulk consumer” smart contracts.

The pilot successfully demonstrated the feasibility of integrating structured NAV data on blockchains, ensuring consistency and accuracy. It also establishes automated data routing through smart contracts, introduces flexible data management, and prevents fragmentation through the ChainLink Cross-Chain Interoperability Protocol (CCIP).

In particular, the project had some impact on existing market practices by allowing customers to use current channels and automatically access historical data without manual recording.

Clients involved in the project gained the ability to use real-time pricing and pricing data through new interfaces, including APIs and smart contracts. The new data consumption methods include real-time API services and smart contracts designed for individual funds or collective fund groups, enabling rapid updates and facilitating various use cases, such as automated portfolio balancing.

Once fully deployed, Smart NAV will open up opportunities to expand the scope of data distribution to include key reference data and other blockchain-enabled workflows. As real-world assets (RWA) such as bonds, funds and other traditional investments are among the most sought-after use cases, such an infrastructure provides the basis for more streamlined and efficient processes in the financial industry. For blockchain technology.

Share this article