Swift has launched a pilot program for its blockchain-based ledger, enabling 17 banks across six continents to exchange tokens representing deposits. Announced on Thursday, the initiative aims to enhance cross-border payment efficiency by facilitating round-the-clock movement of these digital assets.
The pilot involves a consortium of major global financial institutions, including several designated as Global Systemically Important Banks (GSIBs) by the Financial Stability Board. Participants include BNP Paribas, BNY, Citi, HSBC, Standard Chartered, UBS, and Wells Fargo. This collaboration marks a significant step in the adoption of blockchain technology by traditional financial intermediaries.
While final fiat settlement will continue to rely on legacy systems during business hours, Swift’s blockchain-based ledger allows for the movement of tokenized deposits overnight and on weekends. Swift added that the product was developed in nine months, underscoring the rapid pace of innovation.
The ledger’s architecture is compatible with the Ethereum Virtual Machine (EVM). However, Swift’s network is largely centralized, operating a shared environment where banks retain authority over their own assets. Swift noted that this approach allows banks to benefit from improved client experience and global liquidity efficiency without compromising existing compliance, credit, risk, and control standards.
This development aligns with a broader trend of traditional financial institutions integrating blockchain technology. While other networks like XRPLedger and Canton Network offer alternative approaches, Swift’s initiative leverages its established global network. JPMorgan has also explored blockchain, rebranding its tokenization unit to Kinexys from Onyx in 2024.
Mahesh Kini, global head of cash management at Standard Chartered, stated, “We are redefining cross-border payments with Swift’s new blockchain-based ledger—combining tokenized deposits with our global network to deliver instant, always-on money movement.” The pilot program is expected to offer insights into the practical application and benefits of tokenized deposits within the existing financial infrastructure.
Why This Matters
The materials describe a narrow update: Swift announced a pilot program for its blockchain-based ledger, enabling 17 banks across six continents to exchange tokens representing deposits. The exact nature and extent of ‘true settlement’ using legacy systems.
Broader Context
Source materials place the factual news in this context: Swift, the financial gatekeeper connecting thousands of banks across the globe, said on Thursday that a dozen-plus institutions are preparing to use its “blockchain-based ledger.”.
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