Industry buzz around use cases for stablecoins and on-chain Real-World Assets (RWAs) is being amplified by a pending institutional settlement network launch.

Lynq, the newly established platform, will operate using the Arca Institutional US Treasury Fund (TFND). This fund boasts a portfolio of short-term, yield-bearing US Treasuries and leverages the Avalanche Blockchain for its shares. Industry participants require Anti-Money Laundering (AML) and Know Your Customer (KYC) verification for all subscriptions, with client funds securely held at US Bank.

“Lynq will streamline onboarding, subscription and redemption, offering counterparties a safer and more efficient way to transact through settlement rails that integrate regulatory clarity, real-time operations and yield.”

— Katryna Hanush, Wintermute Managing Director

The network benefits from strategic partnerships including tZERO’s special purpose broker-dealer license authority and Tassat’s sophisticated real-time blockchain infrastructure. Notably, Tassat has facilitated over $2.5 trillion in institutional settlement since launching in 2017. Major Wall Street firms including B2C2, Galaxy Digital, and Wintermute plan to onboard their top institutional clients early to ensure critical liquidity for the ecosystem.

Arca Labs President Jerald David stated that the network’s initial adoption strategy aims “to ensure critical mass by onboarding top clients early, expanding adoption and establishing initial liquidity.” The platform has undergone extensive consultation with prime brokers, market makers, exchanges, and stablecoin issuers over a multi-year period.

The architecture is designed to enable fund transfers between institutional accounts and exchanges, supporting both trading activities and account management. Stablecoin issuers are positioned to create and redeem their digital assets directly through the Lynq platform.

Financial infrastructure experts highlight the network’s particularly innovative feature: “yield in transit.” This functionality, explained David, allows institutions to earn interest based on their intraday fund holdings, distributed in five-second increments and settled daily. This represents a significant improvement in the efficiency of temporary fund placement during settlement periods.

The timing of Lynq coincides with remarkable growth in the stablecoin ecosystem. Industry leaders project continued explosive expansion for both tokenized cash and money market fund equivalents. While the stablecoin market has reached approximately $230 billion—a figure expected to surpass $2 trillion within five years according to Agora’s Nick van Eck—the emerging tokenized funds sector appears positioned for complementary growth.

Upcoming Watch The success of Lynq’s implementation will be closely monitored by market participants and competitors alike, with potential ripples across traditional finance’s infrastructure landscape.