ZeroBeta and Lynq have announced a partnership that allows institutional clients to use tokenized assets held on Lynq's settlement network as collateral for secured borrowing and margin trading, without sacrificing the interest those assets generate. The integration connects ZeroBeta's BlueShift risk and collateral management platform with Lynq's settlement and collateral mobility infrastructure, which is built on the Avalanche blockchain.
The collaboration centers on Lynq's newly introduced collateral lock functionality, which enables clients to escrow funds as collateral while the underlying asset continues to earn interest. This addresses a common pain point for institutions holding tokenized assets: pledging them as collateral has typically meant locking them up and forgoing yield during the pledge period.
BlueShift acts as the risk layer, setting terms and monitoring margin across the lifecycle of a loan or trading position. Lynq serves as the neutral rail, holding the collateral and executing pledges and releases based on BlueShift's instructions. By keeping collateral on the same rail from pledge through release, the underlying asset can continue accruing interest throughout the entire process.
The integration supports two primary workflows, both governed by the same threshold logic. In secured borrowing and lending, BlueShift instructs Lynq to pledge the tokenized Treasury asset in favor of the lender, with automatic top-ups or releases as collateral value moves through agreed thresholds. In digital-asset trading, BlueShift calculates margin requirements for open positions and new orders, accepting the tokenized Treasury asset as margin, and instructs Lynq to pledge or release accordingly.
Jerald David, CEO of Lynq, emphasized that institutions should not have to choose between using an asset as collateral and continuing to earn interest on it. He noted that with ZeroBeta, eligible assets can remain on Lynq's settlement network while backing a loan or trading position, providing a more efficient way to put capital to work and advancing the vision of connecting settlement, lending, and trading on a shared network.
Varuna Wijesundera, CEO of ZeroBeta, highlighted that tokenized assets create real value only when institutions can use them in daily operations, with collateral being one of the most compelling use cases. He stated that the partnership brings institutional-grade risk and collateral management directly onto a settlement network where assets earn interest, turning tokenized assets into reliable collateral for lending and trading.
Lynq, operated by tZERO Securities, LLC (an SEC-registered broker-dealer and member of FINRA and SIPC) and developed by Arca Labs, Tassat Group, and tZERO Group, uses its patented Yield-in-Transit™ technology to calculate and distribute interest in real time. The platform has surpassed $89 million in assets and onboarded more than 40 institutional digital asset firms.
ZeroBeta specializes in real-time risk, collateral, and liquidity management across traditional and digital assets, with agentic AI embedded across its platform. Its BlueShift platform is cloud-native and supports real-time computation across multiple asset classes, serving buy-side and sell-side firms as well as market infrastructure providers including clearing houses and depositories.
This integration marks another step in Lynq's efforts to make tokenized holdings useful across a broader range of financial activities, allowing institutions to earn interest, access financing, and support trading through assets they already hold on the network.
This article is for informational purposes only and does not constitute financial advice.
