Key Takeaways
- SWIFT launched a blockchain ledger for tokenized deposits, enabling 24/7 global interbank transactions.
- Seventeen banks will pilot the network, easing liquidity limits and improving fund management efficiency.
- Swift developed the ledger in just nine months, setting the foundation for future programmable money.
Swift Moves To The Blockchain Era With New Tokenized Deposit-Based Network
Financial institutions are now increasingly moving their operations to blockchain, acknowledging several advantages of this decentralized structure.
The Society for Worldwide Interbank Financial Telecommunication (Swift), the Brussels-based institution that manages the messaging network standard for global interbank cross-border transactions, has announced the launch of a blockchain-based ledger that complements the traditional system to implement 24/7 transactions.
The ledger allows participant banks to intermediate tokenized deposits using their own internal system, allowing the provision of services to customers overnight and on weekends, features that traditional networks struggle to provide due to their limitations.
Seventeen banks from six continents, including BNP Paribas, Citi, HSBC, Itaú Unibanco, Lloyds Bank, MUFG Bank, Standard Chartered, UBS, and Wells Fargo, will start conducting pilot payments using Swift’s network, which will allow correspondent banks to ease their liquidity limitations and increase their efficiency in managing funds.
Thierry Chilosi, Chief Business Officer at Swift, stressed that one of the key aspects of this development is linked to the compliance that the Swift-backed system adds to the implementation of this new technology. He explained that the blockchain system will enable tokenized value “to move across borders with the velocity and flexibility modern commerce expects, while maintaining the same high levels of resiliency, security, and compliance global finance requires.”
Swift highlighted the speed of this ledger’s development, which went from proof of concept to operation in just 9 months. Swift’s network was announced just in September, with the participation of over 30 banks.
With this addition to its service portfolio, Swift aims to maintain its leadership in the cross-border payments arena, including a new framework that provides a “strong foundation for the future that will enable value to move in any regulated form, anywhere, with the highest levels of security and resilience,” hinting at the inclusion of programmable money and agentic payments in the future.
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