Chainlink Proof of Reserve System Integrated by 21Shares for Ethereum ETFs

A prominent cryptocurrency company is leveraging a top blockchain oracle service to enhance transparency. In a recent declaration by 21Shares, the firm’s Ethereum (ETH) exchange-traded fund (ETF) is now utilizing Chainlink’s (LINK) Proof-of-Reserve (POR) mechanism.

This development integrates Chainlink’s Proof of Reserve into the 21Shares Core Ethereum ETF (CETH) to offer investors real-time insight into the Ethereum reserves supporting CETH. The primary objective is to establish new benchmarks in the realms of digital asset transparency and security. Chainlink’s POR enables anyone to validate the ETF’s reserve data and its historical reserve information.

The incorporation of Chainlink’s POR closely follows the launch of the first Spot Ethereum ETF in the United States just a week ago. Notably, on a recent Tuesday morning, ETFs from major players like BlackRock, Fidelity, 21Shares, Invesco, Franklin Templeton, VanEck, Grayscale, and Bitwise entered the market.

Sergey Nazarov, the creator of Chainlink, highlighted that Traditional Finance (TradFi) is now preparing for a significant leap in embracing digital assets and smart contracts. He emphasized the acceleration of digital asset and smart contract adoption in TradFi as just the beginning. Once major asset managers and financial institutions transition onto blockchain, the subsequent phase involves linking them with DeFi protocols already empowered by Chainlink.

Nazarov envisions a scenario where there is a universal standard governing transactions across various chains, bridging the realms of DeFi and TradFi. This convergence would pave the way for a global Internet of Contracts, embodying the true essence of the industry’s long-term aspirations.

In conclusion, the collaboration between 21Shares and Chainlink to enhance transparency through the utilization of blockchain technology signifies a significant stride in the evolution of digital asset management and security protocols. The integration of Chainlink’s Proof of Reserve not only fosters real-time visibility into asset reserves but also sets a precedent for heightened transparency standards within the cryptocurrency landscape.