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

Visa, ANZ, ChinaAMC (HK) and Fidelity International have completed a cross-border settlement resolution overseen by the Hong Kong Monetary Authority (HKMA) e-HMO pilot program Phase 2, use Chain link‘s Cross-Chain Interoperability Protocol (CCIP) to move tokenized assets and digital currencies between an authorized bank blockchain and the public Ethereum network.

The pilot demonstrated that an Australian-based investor can purchase a tokenized money market fund (MMF) from a Hong Kong asset manager with near-instant settlement and automated compliance checks, without going through traditional clearing intermediaries.

What did the pilot actually test?

The four institutions are one of eleven consortia in the HKMA’s Phase 2 program, which launched in September 2024 and focuses on the settlement of tokenized assets and the programmability of digital money.

Two experiments were performed.

In the first, ANZ and Fidelity International tested a flow where an Australian investor deposits AUD, receives the Australian dollar stablecoin (A$DC) from ANZ, and exchanges it for a wrapped hypothetical e-HKD. That wrapped e-HKD is then used to purchase tokenized Fidelity MMF units.

In the second experiment, ANZ, Visa and ChinaAMC (HK) replaced the e-HKD with tokenized HKD deposits. ANZ used Visa’s Tokenized Asset Platform (VTAP) to generate these 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, meaning that the fund units and the payment portion are settled simultaneously in a single atomic transaction. Key capabilities tested include:

• Cross-chain transfer of tokenized HKD deposits between an authorized chain and Ethereum
• Automated issuance of fund units, triggered by on-chain NAV data
• Real-time identity verification with personally identifiable information (PII) kept off-chain
• Compliance enforcement embedded at the token level via ERC-3643

How does Chainlink CCIP connect a private banking chain to Ethereum?

ANZ operates DASChain, a private permissioned Layer 2 blockchain using the ZK Validium architecture, which combines zero-knowledge proof (ZKP) technology with institutional controls. Fidelity and ChinaAMC have deployed their tokenized fund contracts on Ethereum’s Sepolia testnet, a public network. Bridging the two directly, without a compliant interoperability layer, would create both security and regulatory gaps.

Chainlink CCIP provided that connection. It passed encapsulated e-HKD data from DASChain to Ethereum, verified cross-chain identity credentials (called CCID) in real time, and confirmed investor portfolio eligibility before unlocking fund tokens on the destination chain.

Identity verification and settlement within one transaction flow

Rather than performing compliance checks separately prior to a transaction, CCIP coordinated asset identity, compliance, and issuance into a single flow. Fidelity’s Digital Transfer Agent (DTA) smart contract reads the chain’s NAV data and automatically issues the correct number of fund units once payment is confirmed to the other chain. No manual reconciliation was required at the time of issue.

Fernando Vazquez, president of Capital Markets at Chainlink Labs, said the pilot “demonstrated how Chainlink enables real-world financial applications within existing regulatory frameworks and through public and permissioned blockchains.”

What is a nuclear settlement and why is it important here?

Atomic settlement means that both parts of a transaction, payment and asset delivery, either complete together or neither proceeds. In traditional fund settlement, cash and assets move through separate systems on different timelines. A failure in one does not automatically undo the other, leaving counterparty exposure in the hole.

By linking tokenized HKD deposits with tokenized MMF units in a single DvP transaction, the pilot achieved near real-time settlement. Both ChinaAMC and Fidelity confirmed that the process eliminated interim delays and reduced reliance on manual back-office reconciliation.

Chainlink’s growing footprint in institutional and DeFi use cases

This pilot fits alongside a broader range of CCIP implementations. Chainlink says its infrastructure has enabled more than $28 trillion in on-chain transaction value through its integrations.

Just a day before the HKMA pilot findings were published, Chainlink launched confirmed that CCIP is now live for bridging Coinbase’s cbBTC (a 1:1 Bitcoin-backed token) from Basic to Monad. Early adopters of the protocol on Monad include Curvance and Neverland, both of which are launching cbBTC markets. William Reilly, head of strategic initiatives at Chainlink Labs, said cross-chain infrastructure “must scale as Bitcoin-backed assets grow into the tens of billions.”

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

Conclusion

The e-HKD phase 2 pilot shows that the technical components for compliant cross-border tokenized fund settlement are functional today. Chainlink CCIP connected an authorized banking chain to a public blockchain, verifying the investor’s identity in real time and coordinating payment and delivery 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 needed to take these components from a controlled pilot to live markets at scale.

Sources

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

2. Chain link on X: Message on March 4

3. Blog article by Monad: Chainlink enables bridging of Coinbase’s cbBTC to the Monad DeFi ecosystem