Financial messaging system provider Swift said its latest series of experiments have shown its infrastructure can assist with the transfer of value across multiple public and private blockchains.
A trial saw the organisation use lits network “and the Chainlink Cross-Chain Interoperability Protocol (CCIP) to create an experimental solution” according to published findings [pdf].
Swift had been seeking solutions that demonstrate its network can carry tokenised assets.
“Overall, the results of the experiment give confidence that existing Swift connectivity and messaging standards can be enhanced, enabling financial institutions to transfer tokens within and across blockchain networks – all with minimal disruption to operations,” Swift’s report said.
It says “a common connectivity layer is critical” for blockchain's broader adoption, and that “enabling interoperability between the existing financial system and blockchains to create a unified global market” is needed.
It tested if the Swift network could enable financial institutions to use their existing backend systems to interact with tokenised assets and transact across both public and private blockchain platforms.
Experiments were designed around the development of a solution, and considerations around data privacy and governance, operational risk, and legal liability.
“Transfers of simulated tokenised assets took place – between two wallets on the same public distributed ledger technology network; between two wallets on different public blockchains; and between a public and private blockchain network,” Swift said.
As part of its ongoing experiments, Swift published a white paper in 2021 that measured the potential impact of central bank digital currencies (CBDCs) and how the company could support the financial community as new currencies are developed.
Swift also released its proposal for a global CBDC network after an eight-month experiment on different technologies and currencies.
Participants collaborating in the latest experiment included ANZ, BNP Paribas, BNY Mellon and Citi.
Other participants included Clearstream, Euroclear, Lloyds Banking Group, SIX Digital Exchange (SDX) and The Depository Trust and Clearing Corporation.
ANZ banking services lead Nigel Dobson said the bank “is actively exploring the use of decentralised networks and tokenisation via a ‘test and learn’ approach, particularly in underserved markets such as the trading of nature-based assets."
“Establishing interoperability between existing financial market infrastructure and multiple blockchains will be critical for greater adoption so we were naturally delighted to participate in this experiment with the Swift community," he said.
ANZ also participated in a recent Reserve Bank of Australia and the Digital Finance Cooperative Research Centre (DFCRC) pilot project, which is exploring the use cases of CBDCs and how they could be applied across the Australian economy.
The RBA and DFCRC results concluded the need for an Australian CBDC is “likely to be some years away”, however did identify “a number of avenues for future research”.
