Bank messaging network SWIFT has stated that blockchain interoperability is a more viable solution for financial systems than combining Central Bank Digital Currencies (CBDC) and other assets into a single ledger. SWIFT believes that as blockchain adoption increases, interconnections between networks will benefit the financial market.
The company plans to deploy Chainlinks Cross-Chain Interoperability Protocol (CCIP) to connect multiple networks and provide a unique financial system. This approach will also reduce operating costs for traditional institutions. SWIFT’s Chief Innovation Officer, Tom Zschach, emphasized that existing secure and trusted Swift infrastructure can remove hurdles in the development of tokenization. The research paper also highlights the potential for tokenization to revolutionize the sector by lowering costs and allowing inclusive investments.
With tokenized assets on different networks, interoperability is crucial. SWIFT will use Chainlink as an abstraction layer to connect its network with Ethereum’s Sepolia network, ensuring interoperability between both source and destination networks. Financial executives, including those from BNP Paribas, have praised the project and believe it is a significant step towards improving digitalization in the financial system.