SWIFT has successfully completed testing transactions with CBDC and tokenized assets on its existing financial infrastructure.
SWIFT has successfully carried out a series of transactions with central bank digital currencies (CBDC) and tokenized assets on existing financial infrastructure. This represents an important milestone for institutional adoption, since it allows its integration into the traditional financial ecosystem.
The SWIFT tests solve the interoperability challenge in cross-border payments, by connecting DLT networks and existing payment systems, allowing cryptocurrencies and tokenized assets to move freely through traditional payment channels.
Interoperability is based on the SWIFT network capabilities and will make it possible for CBDCs and any tokenized assets (bonds, commodities, etc.) to be rapidly deployed within the global financial network (currently spanning 200 countries).
These tests are part of a SWIFT roadmap to allow Instant, interoperable and cheap international payments. This roadmap also includes the new SWIFT Go standard, for low-value payments, and a “payment pre-validation” service, which uses predictive intelligence to verify payments and avoid common errors that cause delays.
SWIFT and tokenized assets
The experiment carried out with tokenized assets has had the participation of institutions such as the Citi group, Clearstream, SETL or Northern. In it, they have made 70 emission and transfer simulations in the market for tokenized bonds, stocks and cash.
The SWIFT network has served as a single access point to several tokenized networks and has demonstrated that it can be used to create, transfer and redeem tokens, update the balances of different wallets and offer interoperability between different tokenization and traditional payment platforms.
The World Economic Forum has estimated that tokenization could reach a worth $24.000 billion by 2027. Additionally, it offers greater liquidity and market fractionation, which could increase access for retail investors to a broader investment market.
CBDCs pass international payments
SWIFT has managed to realize various CBDC transactions between different DLT networks based on Corda and Quorum. It has also been able to perform fiat to CBDC exchanges between these networks and a real-time gross settlement system.
These tests have shown that blockchain networks can be interconnected to make international payments through a single gateway.
They have participated in the CBDC exchange tests 14 central and commercial banks from all over the world, such as Deutsche Bank, HSBC, UBS or Wells Fargo.
Currently, nine out of ten central banks around the world are using CBDC, so these SWIFT tests bring their implementation closer to reality, since they could use a known network for transactions with the greatest interoperability.
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