SWIFT announced the launch of a global study on the interoperability of different blockchain networks based on its existing infrastructure. The project aims to eliminate complexities in the settlement of tokenized assets.
The Society for Worldwide Interbank Financial Telecommunication (SWIFT) announced that it plans to thoroughly investigate how to use its infrastructure to interoperate with various blockchain networks around the world. The initiative aims to eliminate the problem of incompatibility between blockchain networks, enabling the efficient transfer of tokenized value across various blockchain platforms.
SWIFT will work with leading financial institutions, including ANZ, BNP Paribas, BNY Mellon, Citi, Clearstream, Euroclear, Lloyds Banking Group, SDX, and DTCC, to conduct the experiments. Blockchain connectivity for these experiments will be provided by Chainlink.
The experiments will look at options for transferring tokenized assets between wallets:
- within a single public blockchain network;
- between a public and a private blockchain network;
- across different public blockchain networks.
The Chainlink network will be used as part of the experiment to provide connectivity between the SWIFT network and the Ethereum blockchain network. SWIFT is already collaborating with Chainlink to link traditional finance and cryptocurrency.
Other objectives of the project also include:
- Developing an interoperability model that would allow financial institutions to transfer tokenized value between different blockchain networks.
- Simplifying the process of settling tokenized assets, which currently faces incompatibility of blockchain networks.
- Reducing tokenization costs for market participants.
- Eliminating the risks of market fragmentation.
- Creating the conditions for larger-scale trading of tokenized assets.
- Developing solutions to meet the regulatory requirements faced by financial institutions when operating in a blockchain environment.
SWIFT will use its existing infrastructure as a single point of access to various tokenization platforms running on private blockchains. The results of the experiments will be published this year.
SWIFT is actively experimenting with CBDCs, achieving the interoperability of various public digital currency projects. The organization is also developing technical solutions for cross-border transfers using digital currencies.
