Chainlink (LINK) co-founder Sergey Nazarov revealed that the oracle provider has partnered with the interbank messaging system SWIFT to develop a new proof-of-concept (PoC) project that will enable traditional finance firms to transact on blockchain networks.
Nazarov announced the new endeavor at its SmartCon 2022 Conference in New York on Sept. 28 in conjunction with SWIFT strategy director Jonathan Ehrenfeld Solé.
By utilizing Chainlink’s cross-chain interoperability protocol (CCIP), the PoC will allow SWIFT messages to instruct token transfers across nearly every blockchain network. This will help to accelerate the adoption of distributed ledger technology (DLT) blockchains across capital markets and traditional finance, Nazarov said.
The main issue with SWIFT is that transactions can take several days to complete, which is not exactly convenient in an increasingly fast-paced world of global trade and business. To help combat this, the organization recently revealed a new pilot program with Symbiont to explore the integration of blockchain technology to help improve its system.
The firm has also been exploring the use of central bank digital currencies (CBDCs) to facilitate faster payments.
By collaborating with Chainlink, SWIFT member institutions will be able to incorporate the capabilities of blockchain without having to replace, develop or integrate new connections with legacy systems – an undertaking that would require significant modifications a come with an “exceptionally high” cost.
This is not the first collaboration between SWIFT and Chainlink, as the pair had previously worked together to explore bond issuance and redemption, according to Solé.
SWIFT has partnered with Chainlink to develop a new proof-of-concept project that will enable traditional finance firms to transact on blockchain networks.
I'm honestly not entirely sure what to make of this news. What blockchains is SWIFT hoping to utilize? Are CBDCs much closer to reality than we think or would SWIFT really use an existing tech like Etherium?