Swift Explores Connecting with Blockchains to Solve Interoperability Challenges
Summary:
Bank messaging network Swift's report highlights how it can connect with blockchains to overcome interoperability issues. Swift suggests an incremental approach of linking existing systems to blockchains, reducing operational challenges and costs for institutions supporting tokenized assets. The report emphasizes the benefits of tokenization, while acknowledging legal and regulatory challenges.
Bank messaging network Swift has released a report emphasizing how it can integrate with blockchains to address the problem of interoperability among different blockchain networks. The report, titled "Connecting blockchains: Overcoming fragmentation in tokenised assets," suggests that connecting existing systems to blockchains in an incremental manner is a more feasible approach for market development in the near future, rather than combining central bank digital currencies (CBDCs) and tokenized assets in a single unified ledger. Swift identifies a lack of secure interoperability as a major challenge and believes it has the potential to solve this issue. By collaborating with financial institutions and blockchain oracle network provider Chainlink, Swift has demonstrated its capability to provide a single access point to multiple networks using existing infrastructure, resulting in reduced operational challenges and costs for supporting tokenized assets. Tokenization offers various benefits such as increased liquidity, automation, transparency, and security, as highlighted in the report. However, Swift acknowledges that legal and regulatory frameworks still being under development pose additional challenges for institutions engaging in tokenized asset transactions.
Published At
8/31/2023 12:31:49 PM
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