SWIFT Explores Blockchain for Faster, Cheaper Global Payments
Yahoo Finance reports that SWIFT, the global financial messaging network, is exploring blockchain technology to simplify settlements and reduce costs. The ambitious project, one of the most significant in traditional finance, involves over a dozen major banks, including BNP Paribas and BNY Mellon.
SWIFT aims to leverage blockchain to improve transparency and efficiency in its current infrastructure, which serves over 11,000 financial institutions. The pilot project involves creating a stablecoin-like interbank settlement token for near real-time, on-chain settlement of obligations. This could potentially replace legacy systems with faster, cheaper blockchain rails, reshaping global payments.
The project is in its early stages, with several months of testing and evaluation ahead. SWIFT has partnered with Linea, an Ethereum Layer 2 network developed by Consensys, to test on-chain messaging and the new stablecoin-style settlement instrument. Besides BNP Paribas and BNY Mellon, UBS is also involved in the pilot.
SWIFT's blockchain experiment signals a significant shift in traditional finance. While no specific launch timeline has been committed, the project underscores SWIFT's long-term priority to embrace blockchain technology, potentially transforming global financial messaging and settlement.
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