Outside Source
Trillions of dollars will flow into Web3 once the details of the Internet of Contracts are worked out.
News
Own this piece of crypto history
The value of tokenized real-world assets (RWA) will exceed that of cryptocurrencies on Web3 in the next few years, Chainlink co-founder Sergey Nazarov said in his keynote presentation at TOKEN49 in Singapore on Sept. 18. That surge of value flowing from traditional finance (TradFi) will drastically alter the nature of the blockchain industry.
“This is the role I think we should all be preparing for. […] TradFi will be the largest customer of DeFi [decentralized finance],” Nazarov said. Chainlink’s Cross-Chain Interoperability Protocol (CCIP) may have a crucial role to play in an emerging Internet of Contracts that will link central bank digital currency, asset chains, consortium chains and public blockchains, he added.
Blockchain can give TradFi what it needs
The Chainlink oracle network “already powers the majority of DeFi,” having enabled $15.49 trillion in transaction value since 2022, Nazarov said. For TradFi to use blockchain technology, it needs access to a variety of types of data, including live data, “to make TradFi smart contracts function properly.”
Then it needs cross-chain connectivity. CCIP allows users to carry out delivery-versus-payment transactions using stablecoins without integrating vast numbers of chains. Value and data can be included in a single transaction through programmable token transfers:
“You can actually wrap a token in instructions so that, when it reaches its destination, it ends up triggering the event it’s intended for.”
Related: Chainlink dominance challenged by Pyth’s 46x growth in 2024
Working with legacy technology
A single set of standards is desirable for such transactions, but TradFi has “decades of systems” to transact across. Nazarov pointed out the SWIFT network — its enormous user base operates on a single standard. Nazarov said:
“The next stage of the process is really how do you get the TradFi ecosystem to properly utilize all of this […] in such a way that allows the value from their systems to fall onto various blockchains and eventually into DeFi.”
Source: Chris Barrett
In addition, there is a legal barrier between TradFi and Web3, but it is gradually being reduced, especially in Asia and the Middle East, Nazarov said. When all of the kinks are worked out, trillions of dollars will flow into Web3.
Magazine: ChainLinkGod was in High School when he started the account! X Hall of Flame
This article first appeared at Cointelegraph.com News
