CASE STUDY: Redefining Institutional Settlement: How tZERO and Partners Power Lynq’s Real-Time, Interest-Bearing Settlement Network

Collaboration brings together real-time interest bearing, blockchain-based settlement into a single institutional-grade utility

In July 2025, Lynq launched as the world’s first real-time, interest-bearing settlement network for digital assets, marking a new era in how institutional markets manage capital, risk, and liquidity.

Developed by tZERO, Arca Labs, and Tassat, and supported by partners including Avalanche, B2C2, U.S. Bank, Galaxy Digital, FalconX, Fireblocks, Crypto.com, Wintermute, and a milieu of other participants, Lynq transforms settlement from a static process into a live, yield-generating network built for scale.

Utilizing tZERO’s broker-dealer and special-purpose broker-dealer (SPBD) infrastructure, Lynq enables real-time, regulated settlement and transparent proof-of-reserves architecture, bridging the trust of traditional finance with the speed and composability of blockchain systems.

Overview

The launch of Lynq followed 18 months of collaboration and research among leading digital asset institutions, culminating in its first transaction recorded on the Avalanche blockchain, and the first peer-to-peer settlement on the Lynq network.

tZERO Securities, an SEC-registered broker-dealer and FINRA/SIPC member, serves as Lynq’s broker-dealer operator of the platform, providing client onboarding, custody, and transaction services.

This partnership represents a turning point in institutional blockchain adoption, bringing together real-time settlement, interest-in-transit, and a bankruptcy-remote structure under one unified, regulated framework.

Background: Solving Fragmentation in Digital Asset Settlement

Firms have been constrained by fragmented settlement in the digital asset market. Lynq was designed to eliminate post-trade fragmentation by creating a network of trusted counterparties who can settle in real-time and earn interest on idle balances.

The initiative brings together:

• Arca Labs – contributing tokenized asset expertise
• Tassat – providing proven, real-time payment and settlement technology
• tZERO – delivering broker-dealer services and regulated digital asset infrastructure

The result is a next-generation settlement utility designed “by the industry, for the industry”.

The Challenge

Institutional market participants needed a settlement network that could:

1. Resolve market fragmentation and unify liquidity across counterparties
2. Reduce counterparty and operational risk through real-time delivery-versus-payment functionality
3. Unlock capital efficiency by earning interest on balances even during settlement
4. Operate within a regulated framework, ensuring KYC/AML reviews.

Legacy systems were never designed for 24/7 asset mobility, Lynq’s creators saw the opportunity to re-architect settlement as a live, regulated, and interest-bearing process.

The Solution: Real-Time, Regulated, and Interest-Bearing

Lynq’s architecture merges tZERO’s regulatory stack with Tassat’s real-time settlement engine and Arca’s tokenized fund expertise to deliver a unified institutional solution.

Key features include:

• “Yield-in-Transit” (Patent Pending): Balances earn interest even while in motion, turning idle settlement windows into productive capital
• Regulated Broker-Dealer Operations: tZERO’s broker-dealer and SPBD licenses provide the compliance architecture for onboarding and supervision
• Consortium Design: Launch partners including Crypto.com, Avalanche, B2C2, FalconX, U.S. Bank, Fireblocks, Galaxy Digital, and Wintermute expand the network’s liquidity base, counterparty diversity, and institutional reach

Impact: A Structural Leap in Market Infrastructure

The collaboration between tZERO and Lynq bridges traditional financial infrastructure with blockchain-enabled infrastructure. The partnership demonstrates how financial markets can evolve beyond legacy systems without compromising trust or oversight. 

“Our collaboration with Lynq marks a fundamental evolution of market infrastructure – where regulated brokerage, settlement, and blockchain converge into a single utility,” said Alan Konevsky, CEO, tZERO Group, Inc. “We’re demonstrating that institutions no longer have to compromise between compliance and innovation.”

“Lynq was built to solve the longstanding fragmentation in digital asset settlement – enabling institutions to move capital in real time and earn interest during settlement,” said Jerald David, CEO, Lynq. “In partnership with tZERO and our consortium members, we’ve created an infrastructure that brings the efficiency of blockchain to the rigor of institutional finance.”

The result: a foundation that unites institutional credibility with real-time innovation. The impact of the collaboration can be seen across five key areas:

1. The First Real-Time, Interest-Bearing Settlement Utility

Lynq is the first platform to integrate real-time asset mobility, interest accrual, and compliance-first framework within a single system – transforming how institutions manage treasury and liquidity.

2. Turning Post-Trade into Value-Creation

By enabling “Yield-in-Transit,” Lynq reimagines settlement as a profit center, where capital continues earning even while it moves – an unprecedented advancement in capital efficiency.

3. Built for Scale, Designed for Trust

With U.S. Bank as a cash and securities custodian and tZERO’s special purpose broker-dealer (SPBD) as digital asset security custodian, Lynq’s architecture meets the highest institutional standards for governance, security, and safeguarding of assets.

4. Unifying Fragmented Markets

The network links trading venues, custodians, and counterparties through a single settlement layer.

5. Expanding the Role of tZERO

For tZERO, Lynq extends its regulated stack beyond its issuance and secondary trading platform into institutional settlement infrastructure – strengthening its position as a full-stack enabler of digital capital markets.

Results and Future Outlook

The launch of Lynq signaled the emergence of a live, operational network built through institutional collaboration on a regulated platform. Within months of going live, Lynq demonstrated that real-time, interest-bearing settlement can function at institutional scale, connecting participants across multiple layers of digital finance.

Operational Launch – Lynq executed its first transaction on the Avalanche blockchain.

Industry Adoption – Over 50 clients are in onboarding or integration, with 13 already active on the network. Network participants span asset managers, prime brokers, exchanges and more – proving out Lynq’s thesis that regulatory-compliant settlement rails are needed by all industry participants.

Scalable Blueprint – The platform’s model, which combines tokenized interest, SPBD custody, and real-time settlement, sets a precedent for digital asset and real-world asset (RWA) markets.

Next Phase – Expansion into cross-asset settlement (securities, stablecoins, tokenized treasuries) and integration with multi-chain environments through tZERO’s broader network and industry collaboration.

For tZERO, the collaboration extends its reach further into the post-trade lifecycle, reinforcing its position as a full-stack enabler of institutional-grade digital markets. For the broader ecosystem, Lynq establishes a scalable blueprint for transparent, real-time settlement that transforms how capital moves, earns, and settles in the digital era.

Conclusion: The New Benchmark for Institutional Settlement

The launch of Lynq – built by Arca Labs, Tassat, and tZERO – represents a foundational shift in capital markets infrastructure. For the first time, institutions can settle in real-time and earn continuously within a broker-dealer operated ecosystem.

The industry now has a proof point for what the future of settlement looks like: continuous, composable, and value-accretive from start to finish.