Chainlink, a decentralized blockchain oracle network specializing in cross-chain communication, has launched a compliance tool designed to unlock over $100 trillion in institutional investor capital for the cryptocurrency sector.
On Monday, the network introduced its Automated Compliance Engine (ACE), a modular and standardized framework that helps manage regulatory compliance across both traditional finance and decentralized finance (DeFi) ecosystems.
According to Chainlink, the tool enables the development of compliance-focused digital assets and services on public and private blockchains. This includes features such as reusable digital identities, automated policy enforcement, cross-chain compliant digital asset settlements, and regulated asset usage within DeFi.
Currently available in early access for select institutions, ACE aims to pave the way for $100 trillion in new institutional capital to flow into the blockchain economy, the announcement stated.
Built on the Chainlink Runtime Environment, the tool is being launched in partnership with key market players, including financial solutions provider Apex Group, the Global Legal Entity Identifier Foundation (GLEIF), and the ERC-3643 Association.
Traditional finance compliance processes are often fragmented and costly, leading to billions of dollars in expenses for institutions. In 2023, financial crime compliance alone cost institutions in the US and Canada over $60 billion, according to research by LexisNexis and Forrester Consulting.
Chainlink stated that its privacy-preserving compliance framework integrates existing digital identity solutions and supports both on-chain and off-chain policy enforcement, allowing institutions to deploy digital assets in a fully compliant manner.
ACE set to unlock $100 trillion in institutional capital
ACE aims to make digital asset compliance faster, more affordable, and more precise, according to Chainlink co-founder Sergey Nazarov.
“If you create a digital asset using Chainlink’s compliance standard, it will outperform traditional alternatives in speed, cost, and efficiency,” Nazarov explained, adding:
“Chainlink ACE is the compliance and identity standard the tokenized asset economy has been waiting for, with today’s launch providing a final critical building block for over $100 trillion in institutional capital to move onchain.”
Previous solutions often depended on manual processes for risk monitoring and identity verification, leading to duplicated efforts among counterparties due to a lack of transparency.
In contrast, Chainlink’s architecture enables compliance logic to be reusable, upgradeable, and enforceable across various token standards, which the company says will reduce onboarding costs and operational complexities.
Alexandre Kech, CEO of GLEIF, described Chainlink’s compliance engine as “a powerful example of how verifiable organizational identity can enhance compliance across blockchain ecosystems.”
“As regulatory expectations continue to evolve in both digital and traditional finance, we encourage financial institutions to work with their solution providers to adopt the vLEI, strengthening trust, interoperability, and auditability within their compliance frameworks,” Kech added.
