Fidelity, Sygnum partner with Chainlink to bring NAV data onchain

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Chainlink has teamed up with Fidelity International and Sygnum to bring Net Asset Value (NAV) data onchain. 

According to an announcement on July 3, the initiative will see the NAV of Fidelity’s $6.9 billion Institutional Liquidity Fund become accessible onchain in real time.

NAV is a financial metric used to determine the value of a fund’s assets minus its liabilities, divided by the number of shares outstanding. By bringing NAV data onchain, it becomes accessible in real-time, in contrast to traditional methods, which usually update mutual funds data after each trading day.

The data will be available to Sygnum’s clients. Sygnum recently tokenized $50 million from Matter Labs’ treasuries. The initiative was part of Matter Labs’ strategy to move its treasury reserves onchain while still investing in short-term, high-quality debt securities, such as those provided by mutual funds.

Fidelity’s Institutional Liquidity Fund offers a variety of money market sub-funds, primarily for institutional investors.

“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,” Chainlink’s co-founder Sergey Nazarov said in a statement.

In Nazarov’s view, tokenized funds provide far greater efficiency benefits than traditional methods. Over time, they will “become the way the entire asset management industry operates,” he said.

DTCC Pilot

In May, the Depository Trust and Clearing Corporation (DTCC) announced the results of its Smart NAV industry pilot, which relied on Chainlink’s Cross-Chain Interoperability Protocol (CCIP).

The pilot was designed to explore an extension of the DTCC’s Mutual Fund Profile Service I (MFPS I), a standard for transmitting “‘price and rate” data, also known as NAV. The DTCC said in a report:

“The pilot found that by delivering structured data onchain and creating standard roles and processes, foundational data could be embedded into a multitude of onchain use cases, such as tokenized funds and “bulk consumer” smart contracts, which are contracts that hold data for multiple funds.”

DTCC said it sees an opportunity “to potentially expand the scope of the pilot” to power a “broader range of use cases” across a greater number of blockchains.

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