The Society for Worldwide Interbank Financial Telecommunication (SWIFT) said it had a breakthrough in enabling assets on distributed ledger technology networks, such as central bank digital currencies (CBDC) and tokens on the blockchain, to interact and flow with the existing financial infrastructure.
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Fast facts
- In one of two experiments, 14 central and commercial banks explored CBDC integration into existing payment networks to achieve global interoperability, the interbank messaging network said in a press release on Wednesday.
- The second experiment sought to achieve global interoperability among different tokenization platforms.
- The tokenized assets market is expected to make up 10% of global gross domestic product by the end of the decade, according to a recent study from consulting firm BCG and digital exchange ADDX.
- Meanwhile, CBDC interoperability is becoming critical to the future financial system as at least 105 countries have started exploring digital fiat, according to the Atlantic Council.
- “For CBDCs, our solution will enable central banks to connect their own networks simply and directly to all the other payment systems in the world through a single gateway, ensuring the instant and smooth flow of cross-border payments,” Tom Zschach, chief innovation officer at SWIFT said in the press release.
See related article: Singapore Deputy Prime sees “tremendous potential” in tokenization and DLT