Coinbase Institutional announced integrating Chainlink’s robust infrastructure into its Project Diamond platform on Dec. 10. The integration aims to enhance the full lifecycle management of tokenized assets, providing critical data and interoperability across both public and private blockchains. 

Project Diamond: A Game-Changer for Institutional Adoption?

Project Diamond is Coinbase’s highly anticipated digital asset platform designed specifically for global institutions. The platform aims to offer a compliant and secure solution for managing tokenized assets, including real-world asset tokenization, across multiple blockchain ecosystems. 

Initially, the platform will serve registered institutional users outside the U.S. Project Diamond utilizes a robust tech stack that includes Coinbase Prime custody, Prime Onchain Wallet, and USDC, all integrated with the Base layer-2 blockchain. 

The platform operates under the supervision of the Financial Services Regulatory Authority (FSRA) of ADGM, functioning as the Onchain Marketplace.

With this integration, Coinbase will leverage Chainlink’s Cross-Chain Interoperability Protocol (CCIP), which reportedly enables seamless interoperability between public and private blockchains. This will allow tokenized assets to move between different blockchains, while also ensuring data accuracy and security at every stage.

Chainlink’s technology will also help bridge the gap between traditional financial systems and blockchain, making tokenized assets accessible in secondary markets, according to the recent announcement.

Enhancing Data Security and Compliance with Chainlink

One of the key components of this collaboration is Chainlink’s ability to provide verifiable and secure data, which is essential for compliance in the financial industry. 

With institutional-grade solutions such as anti-money laundering (AML), know-your-customer (KYC) data, and market prices, Chainlink ensures that Project Diamond meets the regulatory requirements necessary for institutional adoption. These features are increasingly important as tokenized assets become a crucial part of the financial ecosystem.

Furthermore, the integration will enhance transparency around the collateral backing tokenized assets, making them more attractive to institutional investors by providing clarity and reducing risk.

Peregrine, PSG Digital's regulated business in the Abu Dhabi Global Market (ADGM), has been named as the flagship user of Project Diamond. 

Chainlink Expands Its Presence in the MENA Region

The announcement of the partnership comes at a time when Chainlink is also expanding its footprint in the Middle East and North Africa (MENA) region. On December 10, Chainlink Labs revealed that it had opened an office in Abu Dhabi under the Registration Authority of ADGM. This expansion is part of Chainlink’s strategy to deepen its involvement with financial institutions in the MENA region and enhance the adoption of on-chain finance solutions.

With the MENA region becoming a hub for blockchain and on-chain finance innovations, Chainlink's local presence is expected to foster key partnerships and drive the adoption of tokenized assets.