Chainlink helped Visa, ANZ and Fidelity do what banks have been trying to do for years

Visa, ANZ, ChinaAMC (HK) and Fidelity International complete cross-border payments solution under Hong Kong Monetary Authority (HKMA) e-HKD Pilot Program Phase 2, use chain linkMove tokenized assets and digital currencies between permissioned banking blockchains and the public Ethereum network using the Cross-Chain Interoperability Protocol (CCIP).

pilot proven Australia-based investors will be able to buy tokenized money market funds (MMFs) from Hong Kong asset managers with near-instant payments and automated compliance checks, bypassing traditional clearing intermediaries.

What did the pilot actually test?

The four institutions are one of 11 consortiums in the HKMA’s Phase 2 program, which will launch in September 2024 and focus on tokenized asset settlement and digital money programmability.

Two experiments were performed.

In the first, ANZ and Fidelity International tested a flow in which Australian investors deposited Australian dollars, received ANZ’s Australian dollar stablecoin (A$DC), and exchanged it for a wrapped virtual e-HKD. The wrapped e-HKD will be used to purchase tokenized Fidelity MMF units.

In the second experiment, ANZ, Visa, and ChinaAMC (HK) replaced e-HKD with tokenized HKD deposits. ANZ used Visa’s Tokenized Asset Platform (VTAP) to mint tokenized deposits using the ERC-3643 token standard, which embeds compliance rules such as wallet whitelisting and transaction speed limits directly into the token contract.

Both experiments used a delivery versus payment (DvP) structure. This means that the funding unit and the payment leg are settled simultaneously in a single atomic transaction. The main features tested were:

• Cross-chain transfer of tokenized Hong Kong dollar deposits between Permitted Chain and Ethereum
• Automatic fund unit issuance triggered by on-chain NAV data
• Real-time identity verification with personally identifiable information (PII) held off-chain
• Compliance enforcement built in at the token level through ERC-3643

How does Chainlink CCIP connect private bank chains to Ethereum?

ANZ operates DASChain, a private permissioned layer 2 blockchain using the ZK Validium architecture. DASChain combines zero-knowledge proof (ZKP) technology with institutional controls. Fidelity and China AMC have introduced tokenized fund contracts to Ethereum’s public network, Sepolia Testnet. Bridging the two directly without a compliant interoperability layer creates both security and regulatory gaps.

Chainlink CCIP handled the connection. We relayed wrapped e-HKD details from DASChain to Ethereum, validating cross-chain ID credentials (referred to as CCIDs) in real-time and verifying investor wallet eligibility before unlocking fund tokens on the destination chain.

Identity verification and payment within one transaction flow

Rather than performing separate pre-trade compliance checks, CCIP coordinated identity, compliance, and asset issuance in one flow. Fidelity’s Digital Transfer Agent (DTA) smart contract reads on-chain NAV data and automatically issues the correct number of fund units once payment is confirmed on the other chain. No manual adjustments were required during publication.

Fernando Vazquez, president of capital markets at Chainlink Labs, said the pilot “proved how Chainlink powers real-world financial applications within existing regulatory frameworks and across public and permissioned blockchains.”

What is atomic settlement? Why is it important here?

Atomic settlement means that the transaction, payment and asset delivery stages are completed simultaneously or neither. In traditional funds payments, cash and assets move through separate systems on different timelines. The failure of one does not automatically cancel out the failure of the other, leaving counterparty exposure in the gap.

By combining tokenized HKD deposits and tokenized MMF units in a single DvP transaction, the pilot achieved near real-time settlement. Both ChinaAMC and Fidelity found that this process eliminated intermediate delays and reduced reliance on back-office manual reconciliations.

Chainlink’s footprint expands across institutional investors and DeFi use cases

This pilot will occur in parallel with broader CCIP deployment. Chainlink says its infrastructure has enabled over $28 trillion in on-chain transaction value across integrations.

Just one day before the HKMA pilot study results were announced, Chainlink Confirmed CCIP is currently live to bridge Coinbase’s cbBTC (1:1 Bitcoin-backed token) from the base monad. Monad’s early protocol adopters include Curvance and Neverland, both of which have launched cbBTC markets. William Reilly, Head of Strategic Initiatives at Chainlink Labs, said cross-chain infrastructure “needs to scale as Bitcoin-backed assets grow into the tens of billions.”

The two deployments reflect CCIP operating in different contexts. One within a regulated institutional pilot involving digital money adjacent to a CBDC, and the other connecting Bitcoin-backed liquidity to the new DeFi ecosystem.

conclusion

The e-HKD Phase 2 pilot demonstrates that the technical components for compliant cross-border tokenized funds payments are now operational. Chainlink CCIP connected a permissioned bank chain to a public blockchain, verified investor identities in real-time, and coordinated payments and deliveries in a single atomic transaction.

Visa’s VTAP minted regulated tokenized deposits on demand. ERC-3643 enforced compliance at the token level without manual checks. What remains are the regulatory, governance, and operational standards required to bring these components from controlled pilots to large-scale, real-world markets.

resource

1. New report released by HKMA: e-HKD Pilot Program Phase 2: Transforming global payments: The role of tokenized money and funds in cross-border transactions

2. X chain link: Posted on March 4th

3. Blog post by Monad: Chainlink enables bridging from Coinbase’s cbBTC to Monad DeFi ecosystem