Backed, an asset tokenization platform, has teamed up with Sonic, an Ethereum Virtual Machine-compatible (EVM) blockchain, and Chainlink (LINK), an on-chain finance platform, to tokenize Fortlake’s Sigma Opportunities Fund, ccording to reports shared with Finbold on Wednesday, December 4.
Given the strong market position of each partner, the collaboration is expected to play an important role in bringing traditional finance (TradFi) assets to the blockchain.
Tokenizing the Sigma Opportunities Fund
As part of the partnership, Backed will tokenize the Sigma Opportunities Fund by creating permissionless tokens, each collateralized 1:1 by fund units.
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Token prices will track the fund’s Net Asset Value (NAV) in real time to make them fully compatible with Sonic’s decentralized finance (DeFi) ecosystem.
On the other hand, Chainlink’s SmartData solutions will ensure NAV data flows seamlessly on-chain while its Proof of Reserves and CCIP solutions verify collateral and assets under management and streamline cross-chain operations, respectively.
Fortlake itself will manage the Sigma Opportunities Fund, targeting returns of 7–10% above the federal funds rate.
By capitalizing on market inefficiencies, the fund delivered a 10% return over the past year.
Why is Fortlake partnering with Sonic?
Sonic offers 10,000 transactions per second (TPS) with one-second finality, and its focus on scalability in real-world asset tokenization makes it a solid choice for Fortlake as it continues to work on simplifying back-office operations.
Adam Levi, Co-Founder of Backed, commented on the team’s commitment to developing new asset management solutions:
“Tokenizing the Fortlake Sigma Fund is a major step forward in the blockchain landscape. It showcases how institutions can use blockchain technology to simplify back-office operations and reach new capital. This partnership reflects our commitment to transforming how financial assets are managed and traded.”
— Adam Levi
Colin Cunningham, Head of Tokenization & Alliances at Chainlink Labs, also expressed hopes that Chainlink’s technology can help improve the liquidity of Fortlake’s fund.
Finally, Sam Harcourt, Business Development Lead at Sonic, emphasized Sonic’s broader vision for future endeavours in DeFi:
“This is just the beginning. Sonic aims to bring its advanced technology to financial institutions worldwide.”
— Sam Harcourt
Innovative tokenization solutions
The new initiative is the first of its kind for Backed as a Tokenization-as-a-Service (TaaS) platform.
With innovative tokenization solutions, Backed seeks to create more opportunities for financial institutions and make blockchain more prominent in traditional finance, especially now that BlackRock is entering the market and the Bank of America is forecasting a $16 trillion market in the next ten years.
Early experiments by the likes of Hong Kong Monetary Authority and JPMorgan (NYSE: JPM) also highlight blockchain’s potential in asset management.
All that considered, the partnership between Backed, Sonic, and Chainlink exemplifies how blockchain innovation is paving the way for a more efficient financial system.
