The Society for Worldwide Interbank Financial Telecommunication (SWIFT), a leading player in cross-border payments, has announced plans to integrate traditional banking systems with digital assets. The company revealed its intentions to provide partner banks with access to tokenized solutions, including payment gateways and interoperability with both private and public blockchain networks.
SWIFT, which operates in 22 countries and serves 518 institutions, aims to merge traditional finance with the modern crypto and Web3 industries. Following a series of successful trials, the organization tested the interoperability of crypto tokens with its existing infrastructure, linking it to various blockchain networks. Additionally, SWIFT conducted trials with commercial banks from Europe, Asia, and North America to integrate central bank digital currencies (CBDCs).
Building on these trials, SWIFT plans to roll out decentralised features to its partner banks. This will enable payment processors to seamlessly handle a range of asset and currency types, including existing fiat currencies, CBDCs, tokenized commercial bank money, and regulated stablecoins.
The plans
The firm is working towards enabling multi-ledger Delivery-versus-Payment (DvP) and Payment-versus-Payment (PvP) transactions on its global platform. Initially, payments will be made in fiat currencies, but over time, the network will support tokenized forms of money.
This development has sparked debate in the crypto community, particularly over which token should be used on the platform. While some have advocated for XRP tokens due to their use in similar purposes, others have pointed to SWIFT’s collaboration with Chainlink’s Cross-Chain Interoperability Protocol (CIP) for connecting member banks to various blockchain networks.
SWIFT has spent the last few years testing interoperability with CBDCs, private blockchain networks, and tokenized assets. The Brussels-based organisation is now moving towards real-world applications to interlink various digital assets and currencies, including plans to explore how its platform could connect emerging bank-led networks like the US Regulated Settlement Network with other financial infrastructures.
The next steps for SWIFT involve developing technical standards and assessing what implementation will mean for workflows, standards, and market practices to achieve scalability.
