SWIFT, the global bank messaging network, recently announced that banks in North America, Europe, and Asia will be participating in live trials of digital assets and currency transactions over its network starting next year. This initiative aims to explore how financial institutions can use their existing SWIFT connections to process transactions involving both traditional and digital assets. The trials will focus on easing connectivity challenges between different digital platforms, which are currently hindering the broader adoption of digital assets in the financial sector.
The institutional interest in digital assets is rapidly growing, with 134 countries currently exploring Central Bank Digital Currencies (CBDCs). It is projected that the tokenized asset market could reach $30 trillion by 2034, with 91% of institutional investors showing interest in this sector. SWIFT aims to demonstrate how its network can streamline connections between digital platforms, also known as “digital islands,” to enable the seamless use of digital assets.
SWIFT’s Chief Innovation Officer, Tom Zschach, highlighted the importance of integrating both digital and traditional assets. He emphasized the company’s commitment to offering its community the ability to make and track transactions involving various types of assets using the secure and resilient infrastructure that is central to their operations today. To support these efforts, SWIFT plans to enhance its infrastructure by developing an advanced system capable of managing digital asset and currency transactions across different networks.
In preparation for next year’s trials, SWIFT is collaborating with the Hong Kong Monetary Authority (HKMA) and Banque de France to explore its capabilities in foreign exchange experiments. This collaboration is part of the European Central Bank’s initiative to advance new technologies for wholesale payments. SWIFT is also looking into how its interlinking capabilities could connect emerging bank-led networks, such as the US Regulated Settlement Network, to traditional financial systems.
Additionally, SWIFT has joined Project Agora, a Bank for International Settlements-led initiative that focuses on integrating tokenized commercial bank deposits and tokenized wholesale CBDCs on a unified platform. This collaboration underscores SWIFT’s commitment to advancing the integration of various digital assets within the financial sector. The company’s efforts to connect public and private blockchains, as well as Central Bank Digital Currencies (CBDCs), demonstrate its dedication to driving innovation and facilitating the seamless use of digital assets across different networks.
