Today Swift outlined its vision for digital assets and payments. That includes potentially supporting the settlement of digital asset transactions using the Swift network.
However, the first step will be to enable “multi-ledger Delivery-versus-Payment (DvP) and Payment-versus-Payment (PvP) transactions on Swift’s secure, global platform.”
Many view a lack of regulated on-chain cash as holding back the progress of DLT and regulated digital assets. Hence, the current ECB trials for wholesale DLT settlement, which involve both linkages to existing payment systems, such as a Trigger solution, and a wholesale CBDC. Recognizing this, Swift is exploring ways to enable tokenized asset settlement with the cash leg using fiat currencies. This solution could migrate to CBDC or tokenized deposits as more of them come on line.
Additionally, it wants to explore interlinking separate blockchain networks. For example, linking the Regulated Settlement Network with other initiatives.
“We’re excited about the benefits this bold vision will bring and confident that together we can continue to create an even stronger, more inclusive, and future-proof financial ecosystem,” said Theirry Chilosi, Chief Business Officers at Swift.
Beyond payments for securities, Swift is also keen to explore solutions for FX and trade.
Today’s vision builds on previous Swift work on digital assets and CBDC. In particular, it conducted two sets of trials for its CBDC Connector to enable transactions to use multiple CBDCs. Additionally, last year it conducted public blockchain interoperability trials involving more than a dozen financial institutions, including BNP Paribas, Citi, and the DTCC. It used a combination of Swift and Chainlink’s Cross-Chain Interoperability Protocol (CCIP) to integrate legacy systems with the blockchains.
