SWIFT has successfully shown that tokenised assets can move seamlessly on existing financial infrastructure – a major milestone towards enabling their smooth integration into the international financial ecosystem.
The findings solve the significant challenge of interoperability in cross-border transactions by bridging between different distributed ledger technology (DLT) networks and existing payment systems, allowing digital currencies and assets to flow smoothly alongside, and interact with, their traditional counterparts. This important step forward builds on SWIFT’s core capabilities and means that as CBDCs and tokens develop, they can be rapidly deployed at scale to facilitate trade and investment between more than 200 countries and territories around the world.
Unlocking the potential of tokenised assets
In an experiment, SWIFT 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, its technology partner, 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.
Tokenisation is a relatively nascent market, but the World Economic Forum has estimated it could reach $24tn by 2027. The potential benefits include greater market liquidity and fractionalisation, which could increase access to investment markets for retail investors, and enable institutional investors to build stronger portfolios.
Tom Zschach, Chief Innovation Officer at SWIFT, said: “Digital currencies and tokens have huge potential…
