IDA Finance Leverages Chainlink Network for HKDA Stablecoin

• IDA Finance is integrating Chainlink’s Proof-of-Reserve (PoR) and Cross-Chain Interoperability Protocol (CCIP) into its HKDA stablecoin to enhance transparency and security.
• Chainlink’s CCIP is gaining traction as a standard solution for Web3 projects, with an average of $900,000 worth of tokens sent cross-chain daily.

Hong Kong-based issuer of digital assets IDA Finance stated that they would be integrating Chainlink’s blockchain services into its upcoming HDKA stablecoin, backed by the Hong Kong Dollar. In the latest news release earlier today, October 9, the move seeks to improve transparency while securing the cross-chain operations for the fiat-backed stablecoins.

One of the key reasons behind this collaboration is the integration of Chainlink’s Proof-of-Reserve (PoR) technology, which enables the on-chain verification of the assets supporting the HKDA stablecoin. As reported by CNF, the Proof-of-Reserve mechanism from Chainlink also supports cross-chain applications, secures the minting of tokens by verifying collateral, and complements audit processes for institutions.

How Chainlink PoR Will Boost Stablecoin Security?

The Proof-of-Reserve from Chainlink ensures that users and investors will be able to verify the asset backing HKDA stablecoin while offering greater transparency for the reserve assets maintained by the IDA.

Monitoring the collateral supporting HKDA is essential for the risk reduction associated with insufficient reserves. This will further help to enhance the credibility of stablecoins in a volatile market. Besides, apart from integrating Chainlink’s PoR, IDA will further incorporate Chainlink’s Cross-Chain Interoperability Protocol (CCIP).

In a statement, Sean Lee, co-founder and chief strategy officer at IDA, mentioned that this integration would improve “accessibility to HKDA by making it available across multiple chains”. Additionally, the integration of CCIP will facilitate the use of HKDA stablecoin across several decentralized finance (DeFi) platforms, payment systems, and exchanges, thereby expanding its market reach. According to Lee, IDA sees this as a way to provide “enhanced assurances regarding the stability and backing of HKDA.”

A large number of players in the Web3 space have been integrating the Chainlink CCIP solution. As reported by CNF, the likelihood of Chainlink’s Cross-Chain Interoperability Protocol (CCIP) emerging as a standard solution for Web3 projects is increasing, as evidenced by the daily average of all tokens transferred across chains. Currently, CCIP has achieved a daily average of $900,000 and has processed over 50,000 requests each month.

LINK Price Analysis

For a while, the Chainlink (LINK) price has been under selling pressure and is currently trading 4.78% down at $10.60 with a market cap of $6.6 billion. Despite a strong September, the LINK price has stayed relatively flat. 

Despite this, market analysts continue to be positive on LINK adding that the current price consolidation between $9 to $11 presents a huge buying opportunity, reported CNF. Van De Poppe highlighted that Chainlink has successfully turned a key resistance level into support on the weekly charts, indicating a bullish trend. This momentum could drive LINK to reach $35.29 in the near future, with the potential to challenge its all-time high of $52.88.