US banks successfully complete pilot of fund data tokenization with DTCC and Chainlink

The Depository Trust and Clearing Corporation (DTCC), the world’s largest settlement system, has successfully completed a pilot program in collaboration with blockchain oracle Chainlink and several major US banking firms. The program, known as the Smart NAV Pilot, aimed to standardize the provision of net asset value (NAV) data for funds across blockchains using Chainlink’s Cross-Chain Interoperability Protocol (CCIP), as stated in a report by the DTCC on May 16th. The pilot demonstrated that by delivering structured data on-chain and establishing standard roles and processes, foundational data could be integrated into various on-chain use cases, including tokenized funds and “bulk consumer” smart contracts that hold data for multiple funds. These capabilities have the potential to support future industry exploration and enable brokerage applications, automated data dissemination, and easier access to historical data for funds. The pilot also facilitated better automated data management, minimal disruption to existing market practices for traditional financial institutions, the retrieval of historical data without manual record keeping for clients, and the provision of broader application programming interface (API) solutions for price data. Participating US banking firms included American Century Investments, BNY Mellon, Edward Jones, Franklin Templeton, Invesco, JPMorgan, MFS Investment Management, Mid Atlantic Trust, State Street, and U.S. Bank. Following the release of the DTCC’s report, the price of Chainlink’s token (LINK) increased by 12.5%, according to CoinGecko. LINK has seen a 130% gain in the past year, reflecting the overall growth of the crypto market. The DTCC’s report aligns with the broader interest in real-world asset tokenization among major traditional financial institutions. For example, on March 19th, BlackRock launched a tokenized money market fund called BUIDL on the Ethereum network, offering native US dollar yields. The fund allows investors to purchase tokens that represent shares in the fund and invests in assets such as US Treasury bills. It operates as an ERC-20 token called BUIDL and is referred to as the “digital liquidity fund” because it is digitized on the Ethereum blockchain.