Global financial messaging network SWIFT, in an effort to enable 24-hour payments and compete with the developing stablecoin market, unveiled a blockchain-based shared ledger on Thursday with an initial group of 16 institutions, including Citi and HSBC.
The new ledger would enable “tokenized” funds, which have the advantage of being programmable for specific applications, to be transferred around-the-clock, even on weekends, according to Belgium-based Swift, which powers the great bulk of international bank-to-bank transmission.
It advances one of the largest attempts by the mainstream banking sector to use blockchain technology while maintaining the operational and regulatory constraints mandated by international regulators.
Among the banks involved are UBS, BNP Paribas, BNY, Standard Chartered, MUFG, ANZ, DBS, Lloyds, and others.
The banks’ participation, according to Swift, demonstrated “strong global demand” for the system that will enable banks’ internal tokenized payment systems to communicate with those of other organizations.
The deployment represents the first real-world implementation of the new ledger that Swift announced barely a year ago.
Future developments like programmable money and “agentic commerce,” in which automated systems carry out transactions and payments on behalf of people, might be made possible by it.
Swift facilitates cross-border payments between more than 11,500 banks and other financial services companies worldwide; it estimates that the transactions move the equivalent of the world GDP every two to three days between more than 200 countries.
The initiative also reflects growing efforts by global banks to prepare for a future in which deposits, assets, and payments are increasingly tokenized on digital ledgers while remaining within the regulated financial system.
The blockchain ledger comes amid growing competition between mainstream finance companies and the $315 billion stablecoin issuers Tether and Circle.
