Financial messaging system Swift has released results from a series of experiments, which, it says is evidence that its infrastructure can help the transfer of tokenised value across multiple public and private blockchains.
The cooperative said the findings have potential to remove significant friction slowing the growth of tokenised asset markets and enable them to scale globally as they mature.
One of the key issues challenging investors and institutions is that tokenised assets are managed on different blockchains, each with its own functionality and liquidity profile.
Interoperability between these blockchains is seen as critical. Otherwise financial institutions must build connections to each platform, creating significant operational challenges and cost.
Working with more than a dozen major financial institutions and market infrastructures and Chainlink, a leading Web3 services platform, Swift said it had shown it could provide a single point of access to multiple networks using existing, secure infrastructure, thereby significantly reducing operational challenges. The experiments are part of Swift’s wider strategy to ensure secure, global interoperability as new technologies and platforms emerge.
Tom Zschach, Chief Innovation Officer at Swift, said: “Interoperability is at the heart of everything we are doing at Swift to facilitate the seamless flow of value across the world in the face of increasing fragmentation. For tokenisation to reach its potential, institutions will need to be able to seamlessly connect with the whole financial ecosystem.
He added: “Our experiments have demonstrated clearly that existing secure and trusted Swift infrastructure can provide that central point of connectivity, removing a huge hurdle in the development of tokenisation and unlocking its potential.”
About the experiments
Swift collaborated with several major financial institutions on the experiments, including Australia and New Zealand Banking Group Limited (ANZ), BNP Paribas, BNY Mellon, Citi, Clearstream, Euroclear, Lloyds Banking Group, SIX Digital Exchange (SDX) and
The Depository Trust & Clearing Corporation. Chainlink was used as an enterprise abstraction layer to securely connect the Swift network to the Ethereum Sepolia network, while Chainlink’s Cross-Chain Interoperability Protocol (CCIP) enabled complete interoperability between the source and destination blockchains.
The experiments focused on demonstrating that existing Swift infrastructure can provide a secure, scalable way for financial institutions to connect to multiple types of blockchain. They also examined further the technical and business requirements for interacting with business and public blockchains.
Among other uses, the experiments explored the value of a blockchain interoperability protocol for securely transferring data between existing systems and a potentially unlimited number of blockchains.