Hong Kong-based IDA will integrate the HKDA stablecoin with Chainlink to facilitate secure cross-chain operations.
To improve cross-chain operability and protect assets, IDA Finance incorporates Chainlink’s Proof of Reserves and CCIP products.
Hong Kong-based digital asset issuer IDA Finance said it has adopted Chainlink’s blockchain services to develop the HKDA stablecoin that backs the Hong Kong dollar.
As stated in an October 9th press release, the aim of this move is to enhance transparency and protect cross-chain transactions of fiat-backed stablecoins.
The partnership hinges on the integration of Chainlink’s Proof-of-Reserves (PoR) system, which provides on-chain asset verification for the HKDA stablecoin.
However, Chainlink’s PoR technology allows users and investors to verify the assets that support the HKDA, facilitating transparency regarding the reserve assets maintained by the IDA.
By monitoring the collateral behind HKDA, IDA can also minimize the risk of running out of reserves and strengthen the reliability and safety of the stablecoin during market fluctuations.
Along with integrating Chainlink’s PoR technology, IDA will implement the Cross-Chain Interoperability Protocol (CCIP) provided by Oracle Services.
Sean Lee, co-founder and chief strategy officer at IDA, said in a release that the integration will “enable access to HKDA by making it available across a variety of chains.”
Additionally, the introduction of CCIP will enable HKDA to be adopted by decentralized finance (DeFi) platforms, exchanges, and payment systems, expanding its market reach.
Related article: Chainlink CCIP goes live on ZKsync Era mainnet
In Lee’s words, IDA sees this as a way to provide “enhanced guarantees of stability and support for the HKDA.”
According to a Chainlink report released on September 17, almost 9% of the total amount of cryptocurrencies received worldwide from July 2023 to June 2024 came from East Asia.
Maruf Yusupov, co-founder of Diener, a digital stablecoin backed by physical gold, claimed in an interview that stablecoins and cryptocurrencies are “gradually replacing fiat currencies.” .
Yusupov cited “lower barriers to entry,” increased ease of use, and lower costs as factors driving this change, adding that continued adoption could drive users away from traditional banking institutions.
