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- Huma Finance is ditching general bridges for Chainlink’s CCIP to protect its $12 billion in transaction volume.
- The move focuses on bringing Solana-based yield products to other blockchains with institutional-grade safety.
- Chainlink’s network of 16 independent node operators will now oversee every single transfer for the PayFi leader.
The decentralized finance world has learned a hard lesson lately: bridges are often the weakest link. After watching a string of high-profile cross-chain hacks drain millions from various projects, Huma Finance is making a defensive pivot by integrating Chainlink’s Cross-Chain Interoperability Protocol (CCIP) to bolster its security infrastructure.
However, PayFi’s network, which handles more than $170 million in live liquidity, has decided to put all eggs in one basket and choose Chainlink’s Cross-Chain Interoperability Protocol (CCIP).
Huma is choosing CCIP as the exclusive base protocol for its key yield-bearing asset called PST. It is crucial to remember that for a network responsible for facilitating cross-chain real-world payment transactions, every technical bug means not only price crashes but also a complete halt to transaction processing.
Building a Fortress for Institutional Assets
Institutions have always been wary of cryptocurrencies. In order to convince them, Richard Liu, co-founder and co-CEO of Huma, says that security should precede growth. With Huma moving towards safer bridging technology, more layers of security are added for large institutional investors who require robust protection.
Rate limitations on transactions, along with other policy-based restrictions, work as a digital circuit breaker when there’s anything abnormal. Chainlink adds a strong infrastructure to the game. Rather than depending on a few validators, the Chainlink solution opts for decentralized oracle networks (DONs).
What this implies is that there need to be at least 16 different node operators to agree on a transaction. This ensures maximum security as no single entity can compromise the process. Huma, which crossed the $12 billion mark in terms of overall volume, requires such robust security for scaling.
Exporting Solana Assets via Chainlink Data
Even though Huma has achieved success on Solana, finance in the future is going to be multichain, allowing people to earn from yields from different blockchains depending on their preference. According to Johann Eid, the Chief Business Officer at Chainlink Labs, the collaboration will enable Huma to expand its assets globally through market data provided accurately and fast.
By embracing industry standards such as Chainlink, Huma will act as a link between payment systems and the blockchain world. By using Chainlink data feeds and streams, Huma can make sure that the prices of its products remain accurate despite market volatility. With time, Huma will be able to show the rest of the markets that it is prepared for the big leagues where losses of funds cannot happen.
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