In the latest step towards Polygon 2.0, Polygon (MATIC) has finally launched it’s new ZK layer-2, Libre, enabling institutions to use compliant tokenized funds on a bespoke tokenization ZK L2.
Polygon, a scaling solution for Ethereum, has long been working on the highly anticipated Libre offering, with a ZK layer-2 platform specifically crafted for tokenizing institutional assets in high demand, both for low-cost tokenization and corporate privacy on DLTs.
Yet, this also comes with an institutional requirement to ensure tokenization is fully compliant with regulatory environments.
In a blog post on March 19, Polygon said Libre utilizes its tools to provide a secure and compliant environment, instilling confidence in financial institutions seeking to explore blockchain’s capabilities – and positioning Polygon alongside the ranks of JP Morgan’s private tokenization blockchain Onyx.
Unlocking TradFi Tokenization Via Polygon and Libre
The tokenization-specific ZK L2 chain, Libre, is live.@librecap now delivers a compliant way for institutions to tokenize alternative assets, while enabling onchain access to performant funds, like hedge funds from Brevan Howard and money market funds from Blackrock.
Libre's… pic.twitter.com/Ukc3SaOAPs
— Polygon | Aggregated (@0xPolygon) March 19, 2024
Polygon notes that Libre addresses a key challenge for institutions trialing the blockchain: efficiency and customization – with Libre aiming to side-step costly and time-consuming intermediaries whilst reducing fees.
Addressing past concerns, Libre circumvents the congestion and competition for resources on general-purpose blockchains like Ethereum or Bitcoin.
Although popular, these networks are not scalable enough, and transaction fees are relatively higher than Polygon, for example – furthermore – the integration of zero-knowledge technology provides a degree of privacy to institutional fund tokenization – without compromising on compliance.
Libre establishes an environment where institutions can tokenize assets more efficiently and cost-effectively, enhancing user experience and offering reassurance about its capabilities.
Compliant Tokenization & On-Chain Access Could Supercharge MATIC
Interested institutions can tokenize various assets through Libre, including money market funds, with two offerings currently on the market via Libre – tokenized funds offered by Brevan Howard, a hedge fund, or they can access funds minted from BlackRock, one of the world’s largest asset managers.
Libre effectively streamlines access since eligible investors can quickly and transparently access these high-performing funds, with 24/7 liquidity.
This is just the beginning, with the launch of Polygon’s new ZK L2 aiming for the seismic opportunity surrounding tokenization of real world assets – an industry projected to be worth $10Tn by 2030.
And big players are taking notice, BlackRock has launched the BlackRock USD Institutional Digital Liquidity Fund on Ethereum. The product, formed in partnership with Securitize, was seeded with $100 million, according to filings from the United States Securities and Exchange Commission (SEC).
And Blackrock CEO Larry Fink has publicly said that tokenization was an important technological advancement, that would redefine how assets are handled in the 21st century.
Looking Ahead to Polygon 2.0: Interoperability And Tokenization
Libre will form part of Polygon’s so-called AggLayer, which forms a central part of the network’s plan to build an interconnected web of layer-2 chains.
This objective is central to the highly anticipated “Polygon 2.0” – which is anticipated to fuel major value accrual for MATIC price.
Aligning with this vision, Libre is creating a gateway that seamlessly connects with other protocols leveraging Polygon’s tools, this gateway will also link to the AggLayer, further enhancing liquidity.
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Disclaimer: Crypto is a high-risk asset class. This article is provided for informational purposes and does not constitute investment advice. You could lose all of your capital.
