Chainlink launched CustodySync on Oct 26, a solution that lets qualified custodians give institutional clients access to DeFi lending while assets remain in custody (announcement).

Chainlink launched CustodySync on Oct 26, a solution that lets qualified custodians give institutional clients access to DeFi lending while assets remain in custody (announcement).

Anchorage Digital is the official launch partner, connecting Anchorage Digital Bank custodied assets to onchain lending markets, with its Atlas Collateral Management product managing offchain collateral for onchain loans (Anchorage).

How it works: assets stay with the custodian, Chainlink Proof of Reserve publishes custody balances onchain, Data Feeds price loans onchain while Data Streams send identical values to the custodian, and CRE keeps custody and lending in sync across borrows, repayments and interest (explainer).

The collateral is a transfer-restricted receipt token with supply tied to custodied assets, posted as collateral to borrow in one transaction, with Atlas acting as appointed collateral agent to sell and settle atomically onchain past the liquidation threshold.

Chainlink frames the opportunity as $80B+ in DeFi lending deposits versus roughly $700B in digital assets under custody, itself under 0.5% of $250T in traditional custody.