900 billion pain point solved: JPMorgan uses blockchain to achieve real-time "delivery versus payment" settlement
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900 billion pain point solved: JPMorgan uses blockchain to achieve real-time "delivery versus payment" settlement
This is the first time Kinexys has connected its permissioned blockchain network to a public Layer 1 chain through Chainlink's interoperability infrastructure.
Navigating Web3 tides with focused insightsAuthor: Cryptoslate
Translation: Blockchain Knight
JPMorgan has partnered with Ondo Finance and Chainlink to complete a groundbreaking pilot transaction that bridges traditional finance and blockchain.
According to a statement on May 14, the banking giant’s blockchain division, Kinexys, successfully executed a cross-chain atomic settlement using Ondo Finance’s tokenized short-term U.S. Treasury product, OUSG.
This marks the first time Kinexys has connected its permissioned blockchain network to a public Layer 1 chain via Chainlink’s interoperability infrastructure.
Nelli Zaltsman, Head of Settlement Solutions at Kinexys, said the move reflects JPMorgan’s evolving support for institutional clients as they engage with new digital infrastructure.
The executive added, “By securely and thoughtfully seamlessly connecting our institutional payment solutions with external public and private blockchain infrastructures, we can deliver broader benefits and scalable transaction settlement solutions to our clients and the wider financial ecosystem.”
This landmark test transaction was conducted on Ondo Chain’s testnet, Ondo’s blockchain built specifically for real-world asset tokenization. It employed a Delivery versus Payment (DvP) model, which enables simultaneous transfer of assets and payments to reduce settlement risk.
Traditional DvP transactions often face delays due to fragmented systems and manual processes associated with legacy systems. Industry estimates suggest these inefficiencies have cost market participants over $900 billion in the past decade.
In cross-border transactions, complexity is further multiplied by differing regulations, currencies, and jurisdictions, creating additional friction.
Leveraging blockchain technology, Kinexys and its partners demonstrated a real-time settlement process that reduces manual intervention, lowers counterparty risk, and enhances liquidity. Chainlink provided the message-passing framework that synchronizes operations across the two blockchain networks.
Kinexys relied on blockchain-based deposit accounts to fulfill the payment leg of the transaction, while Chainlink ensured data consistency between the permissioned and public chains. This reduced operational friction and enabled final transaction confirmation within seconds.
Sergey Nazarov, co-founder of Chainlink, called the pilot a milestone in connecting traditional finance and decentralized finance. He noted that global financial institutions now recognize the need for secure access to public blockchains and robust cross-chain tools to enter new markets.
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