Swift aims to integrate fiat money with tokenized assets

Key facts:
  • The company said the multiplicity of platforms and technologies creates a complex environment.

  • Swift is a system used by 11,000 financial institutions and more than 200 countries.

Global financial messaging system Swift aims to consolidate the bridge between traditional finance and the digital asset ecosystem. The company announced that is studying ways to integrate fiat money (fiat) with tokenized assets.

The company’s proposal It is based on using its network to facilitate interoperability between currencies fiat and tokenized assets. These solutions, which would connect digital assets and currencies to their existing infrastructure, would enable their members (banks and financial institutions) to access the use of these tokenized assets for payments, securities transactions, trading, among others.

“We are paving the way towards real-world solutions capable of interconnecting various forms of digital assets and currencies. In the future, this could allow securities buyers to simultaneously pay for and exchange tokenized assets in real-time on our network.”

Press release from Swift, a global financial messaging network.

For its part, Swift is currently testing simultaneous transaction settlement mechanismsThis includes trials of delivery-versus-payment (DvP) systems, where securities are only delivered when funds are received, and payment-versus-payment (PvP), which allows simultaneous exchanges in different currencies.

DvP ensures that the exchange of securities (stocks, bonds, etc.) and payment occur in sync, while PvP ensures that two payments are made at the same time in different currencies. Thus, Swift aims for its infrastructure to enable these mechanisms with money. fiat and tokenized assets, such as Central Bank Digital Currencies (CBDC) or stablecoins regulated, for example.

Swift says some problems still exist

The company stated which wants to solve a problem that institutional investors face and that does not allow them to “start their digital asset businesses.” He referred to the fact that The increase in various platforms and technologies for operating with tokenized assets creates a highly complex environment.

Thus, by using its infrastructure to provide transactions in tokenized assets, Swift members would not have to create new connections to interact with these emerging assets or resort to other intermediaries outside the Swift network.

On the other hand, the company seeks to address the lack of a globally accepted form of digital money. According to the statement, the long-term goal is to enable the use of tokenized forms of money, which would facilitate real-time exchange on the Swift network.

Swift experiments with tokenized assets on its network

As reported by CriptoNoticias, Swift has been experimenting with the use of CBDC coins for some time now. During those tests carried out in October 2022, The company reported that they managed to unite different payment and accounting networks distributed globally.. This resulted in CBDCs and tokenized assets being traded correctly, alongside their traditional counterparts.

In turn, in August 2023, Swift announced a new successful procedure in which they managed to transfer digital assets using their network across other blockchains.

In that case, the company will connected through Chainlink’s Cross-Chain Interoperability Protocol (CCIP) with the Ethereum chain, Sepolia. This mechanism allowed the networks to interact with each other fluidly and digital asset transactions to be carried out on the Swift network.

Source link

Leave a Comment