Financial messaging provider SWIFT has created an infrastructure that eases the integration of various central bank digital currencies (CBDCs) and tokenized assets into the international financial system.
SWIFT is a platform for financial communications that links over 11,500 financial institutions in 200 different countries to carry out quick, simple, and interoperable cross-border transactions.
When blockchain technology first emerged, SWIFT took action to solve interoperability issue between various blockchain networks and the current financial systems.
On October 5, SWIFT made an announcement that its infrastructure has succeeded in two independent tests involving the integration of tokenized assets and CBDCs.
SWIFT and Capgemini worked together to complete a CBDC-to-CBDC transaction on various blockchains. Moreover, a fiat-to-CBDC transfer was successfully carried out in the research.
SWIFT Chief Innovation Officer Tom Zschach said that the innovation could help address CBDC’s need for interoperability with the existing financial system.
By 2027, the market for tokenized assets could be worth $24 trillion, according to the World Economic Forum (WEF), utilizing the possibility that it may increase market liquidity. SWIFT built its infrastructure to link several platforms for tokenization.
70 market scenarios for the issue and transfer of tokenized bonds, stocks, and cash were simulated by SWIFT in collaboration with Citi, Clearstream, Northern Trust, and SETL.
The platform proved effective as a single entry point for the production, exchange, and reclamation of tokenized assets. Additionally, it offered interoperability between various tokenization platforms.
