Key Takeaways:
- The test bridges JPMorgan’s private blockchain with a public Layer 1, allowing atomic settlement of tokenized treasuries and fiat-backed payments using Chainlink’s CRE.
- With CRE coordinating the transaction, Chainlink has effectively positioned itself as core infrastructure for cross-chain financial interoperability.
- Kinexys, which already moves $2B+ in daily volume, is demonstrating real-world, compliant blockchain deployment, not just sandbox innovation.
Kinexys has leapt from JPMorgan’s private ledgers on May 14 using Chainlink to settle tokenized U.S. Treasuries on Ondo Chain in a split-second swap that heralds Wall Street’s blockchain future.
The successful test indicates a step in connecting traditional finance with decentralized infrastructure, using blockchain-based systems for atomic, cross-chain settlement.
The trade involved a Delivery versus Payment (DvP) transaction between Kinexys Digital Payments’ permissioned blockchain and Ondo Chain, a newly launched Layer 1 designed for tokenized real-world assets.
Kinexys and Chainlink Bridge TradFi and DeFi with Tokenized Treasury Test
According to the announcement, the asset in the transaction was Ondo Finance’s Short-Term U.S. Government Treasuries Fund (OUSG), a tokenized treasury product, while Kinexys served as the payment leg, settling through blockchain deposit accounts on its digital payments network.
Chainlink’s role in the transaction was central. Its secure off-chain computing system, the Chainlink Runtime Environment (CRE), orchestrated the atomic exchange.
The system integrated directly with Kinexys’ synchronized settlement workflow to ensure seamless coordination between the two networks, maintaining high institutional standards for security and compliance.
The Head of Platform Settlement Solutions at Kinexys, Nelli Zaltsman, said, “Kinexys Digital Payments is designed to support J.P. Morgan’s institutional clients by enhancing the current payment experience while anticipating future needs.”
“By securely connecting with both public and private blockchain infrastructure, we can offer scalable solutions for settlement. This first transaction on Ondo Chain testnet is a strong example of what’s possible through collaboration,” he added.
The successful DvP settlement addresses long-standing challenges in traditional finance, where fragmented systems and manual workflows often cause costly delays. Cross-border transactions are especially complex due to differing regulations and currencies.
By settling both asset and payment legs on-chain, counterparty and settlement risks are reduced, while liquidity management and transparency are improved.
Sergey Nazarov, Co-founder of Chainlink, commented on the broader implications, saying, “This is a clear sign of the TradFi and DeFi convergence we’ve talked about for years. Chainlink was built to enable secure, institutional-grade transactions across multiple blockchains. This collaboration with Kinexys and Ondo shows that institutions now recognize the public blockchain community as a major opportunity.”
The Kinexys platform has processed over $1.5 trillion in notional value to date, with daily volume averaging more than $2 billion.
Institutional Tokenization Accelerates as JPMorgan Deepens Web3 Involvement
JPMorgan’s tokenized treasury trade on Ondo Chain marks a key moment in the growing institutional embrace of blockchain-based real-world assets (RWAs).
The move comes as the total value locked in RWAs across DeFi platforms surpasses $12 billion, according to DeFi Llama, showing surging interest from large players.
BlackRock’s USD Institutional Digital Liquidity Fund alone now holds close to $3 billion, up 19% over the past month, per rwa.xyz data.
JPMorgan has been active in this space since launching its private blockchain in 2019, later rebranded as Kinexys. The platform now processes roughly $2 billion in daily transaction volume, backed by $1.5 trillion in derivatives exposure.
Ripple and BCG project the tokenized RWA market to reach $18.9 trillion by 2033, growing at a 53% CAGR.
The financial sector is in the first phase of adoption, focused on familiar instruments like treasuries and money market funds.
As infrastructure matures and regulation advances, the shift toward tokenizing complex assets such as private credit and real estate is already underway.
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