Swift, the backbone of the global financial messaging system, is taking steps toward becoming a full-fledged blockchain infrastructure provider.
This week, the network announced plans to build a shared ledger platform that will allow transactions involving stubcoins and tokenized assets to be resolved across multiple blockchains.
Swift has long served as the messaging layer for cross-border money movements, but the new platform brings it closer to the center of value transfer.
This is a major change for a 50-year-old traditional financial organization known for handling communications between more than 11,500 banks, rather than moving money itself.
Swift’s changing role
“The big development is Swift’s changing business model. Ciphers are now macros Newsletter. “Today, Swift doesn’t transfer value; it sends messages. ONCHAIN, messages, and transfers are the same thing.
Acheson argued that the new platform could act as a “switch” layer for digital currencies and tokenized assets, bridging otherwise siled systems. However, she questioned whether Swift is still essential in the world of programmable money.
“Is Swift necessary in a tokenized financial system? No, it isn’t, but it has connections to almost every global bank,” she said.
Stupid banks, stupid banks.
These connections could give Swift an edge as banks look for a path to the blockchain economy.
“The industry is moving at a rapid pace, and Stub Lovecoin is being adopted globally at such a rate that traditional banks have to take note,” said Barry O’Sullivan, Director of Banking and Payments at OpenPayd.
Swift said more than 30 financial institutions are already involved in the project. O’Sullivan expects more as demand and regulatory clarity increases. “Adoption, interoperability and regulatory alignment will take time,” he said. “However, Swift is clearly positioning itself to play a meaningful role in shaping the evolving Stablecoin and tokenized asset ecosystem.”
According to David Duong, head of institutional research at Coinbase, Swift’s platform also has the potential to “significantly reduce” technical barriers and integration costs for financial institutions looking to embed Stablecoins into their operations.
O’Sullivan said the platform “has the potential to bring standardization to the global Stablecoin ecosystem,” but fragmentation is likely to persist. “Existing private stub coins, CBDCs and regional solutions may continue to operate in parallel,” he said.
year made
Duhon described Swift’s initiative as a “watershed moment” for both crypto and traditional finance, but reminded that it has been in the works for many years. The company has been experimenting with distributed ledger technology since 2017, Duong said, and has conducted pilot projects at ChainLink, tokenized securities platform ClearStream and interoperability tests using SETL and CBDC. Developing its own shared ledger platform appears to be the next step in that long-term transition, Duong said.
Still, not everyone sees Swift as a neutral player. Its role in enforcing sanctions has led to mistrust in countries where banks have been cut off from networks, Acheson said.
“Given the global distrust following our company and Swift’s role in enforcing EU sanctions, it is not clear that its offering will stop the fragmentation of payment systems,” she argued.
Still, Swift’s decision highlights how the lines between traditional and blockchain finance are becoming increasingly intertwined, with the world’s largest financial institutions slowly and suddenly taking initiatives to stay relevant.
