SWIFT, the financial messaging system, has conducted two separate exercises to demonstrate that central bank digital currencies (CBDCs) and tokenised assets can move on existing financial infrastructure. SWIFT says this will solve the significant challenge of interoperability in cross-border transactions by bridging between different DLT networks and existing payment systems.
In collaboration with Capgemini, SWIFT achieved CBDC-to-CBDC transactions between different DLT networks based on Quorum and Corda technologies, as well as fiat-to-CBDC flows between these networks and a real-time gross settlement system. This showed that the blockchain networks could be interlinked for cross-border payments through a single gateway, and that SWIFT’s new transaction management capabilities could orchestrate all inter-network communication. 14 central and commercial banks, including Banque de France, Deutsche Bundesbank, HSBC, Intesa Sanpaolo, NatWest, SMBC, Standard Chartered, UBS and Wells Fargo, are now collaborating to accelerate the path to full scale deployment.
In a separate experiment, SWIFT similarly demonstrated that its infrastructure can serve as an interconnector between multiple tokenisation platforms and different types of cash payment. Working in collaboration with Citi, Clearstream, Northern Trust, and SETL, SWIFT explored 70 scenarios simulating market issuance and secondary market transfers of tokenised bonds, equities and cash. It successfully served as a single access point to various tokenised networks and showed its infrastructure could be used to create, transfer and redeem tokens and update balances between multiple client wallets, as well as provide interoperability between different tokenisation platforms and existing account-based infrastructure.