Chainlink has introduced a new compliance framework designed to reduce costs and streamline regulatory processes, with the ambitious goal of unlocking more than $100 trillion in institutional capital for the crypto economy.
On Monday, the decentralized oracle network unveiled its Automated Compliance Engine (ACE)—a modular, scalable solution aimed at bringing regulatory clarity to both traditional and decentralized financial systems.
By integrating compliance directly into the digital asset layer, Chainlink hopes to eliminate the complex and often costly regulatory barriers that have long deterred institutional investors from entering the blockchain space.
A Unified Compliance Standard for Traditional and Decentralized Finance
Built on the Chainlink Runtime Environment, ACE offers a standardized way to enforce compliance across public and private blockchains. This includes tools for:
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Creating reusable, privacy-preserving digital identities
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Automating policy enforcement
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Enabling compliant crosschain settlement of digital assets
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Facilitating the use of regulated assets within DeFi protocols
Currently available through early access to select institutions, ACE aims to bridge compliance requirements between legacy finance and blockchain-based systems.
According to Sergey Nazarov, Chainlink’s co-founder, ACE will make digital assets “better, cheaper, and faster” than their traditional counterparts. He emphasized that integrating compliance directly into the asset design would minimize friction, reduce costs, and enhance security—key requirements for institutional adoption.
Tackling the High Cost of Compliance
Compliance in traditional finance comes with a hefty price tag. In 2023 alone, financial crime compliance costs reached over $60 billion in the U.S. and Canada, according to a study by LexisNexis and Forrester Consulting. These costs are largely due to manual identity verification, fragmented data systems, and duplicated due diligence processes.
Chainlink believes ACE can significantly cut these costs by standardizing and automating compliance processes, allowing institutions to streamline operations and avoid redundancy.
Unlike older models that required repeated verification steps, Chainlink’s system enables interoperable, upgradeable compliance logic that can be applied across token standards. This reduces onboarding times and simplifies the operational burden for institutions moving into crypto markets.
Chainlink backed by Industry Collaboration
Chainlink didn’t build ACE in isolation. The project is launching in partnership with several established players, including:
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Apex Group, a global financial services provider
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The Global Legal Entity Identifier Foundation (GLEIF)
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The ERC-3643 Association, which focuses on tokenized securities
These collaborations have allowed Chainlink to align ACE with global regulatory expectations and existing identity frameworks, including the verifiable Legal Entity Identifier (vLEI) system.
Alexandre Kech, CEO of GLEIF, called Chainlink’s framework a strong example of how organizational identity can boost compliance in blockchain environments. He urged financial institutions to work with their providers to explore vLEI and strengthen auditability and trust.
Turning Point for Institutional Crypto Adoption?
ACE represents a major step toward making crypto safer and more accessible for traditional institutions, which have often been sidelined by regulatory uncertainty and high compliance costs.
By providing a plug-and-play compliance solution that works across chains and sectors, Chainlink hopes to remove one of the last major hurdles to institutional entry into the blockchain economy.
Whether it’s enabling tokenized securities, DeFi-based lending, or cross-border settlements, the framework could open the door for banks, asset managers, and fintech firms to deploy digital assets with the same legal certainty and compliance control they expect from traditional finance.
And with over $100 trillion in institutional capital potentially in play, the stakes—and opportunities—are massive.