Project for cross-chain bitcoin transfers involves SWIFT and Chainlink

The project will link practically all blockchains to the SWIFT network, giving traditional financial agents access to both digital and physical assets on the same network.

Project for cross-chain bitcoin transfers involves SWIFT and Chainlink

A messaging system for banks Working on a proof-of-concept (POC) initiative that would enable traditional financial firms to interact across networks, SWIFT has teamed up with price oracle supplier Chainlink (LINK). the blockchain

At his SmartCon 2022 conference, which was hosted in New York on September 28, Chainlink co-founder Sergey Nazarov and SWIFT Chief Strategy Officer Jonathan Ehrenfeld Solé made the project announcement.

In an initial proof of concept, SWIFT is utilizing the Cross-chain Interoperability Protocol (CCIP). The SWIFT network will become interoperable with all blockchain systems thanks to CCIP, which will enable SWIFT messages to specify on-chain token transfers.

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Solé stated at the conference that institutional investors have "an indisputable interest in digital assets," adding that major participants in the traditional financial industry want access to both digital and traditional assets on a single platform.

The POC makes use of Chainlink's Cross-chain Interoperability Protocol (CCIP), which, according to Nazarov, will hasten the adoption of blockchain technology by enabling SWIFT messages to instruct token transfers across almost all blockchain networks. with traditional financial and capital markets using distributed ledger technology (DLT).

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With more than 11,000 banks worldwide connected, the SWIFT interbank messaging system is the most popular platform for conventional cross-border fiat transactions. The system received 44.8 million messages every day on average in August.

On the SWIFT network, transactions can, however, take several days to complete. To enable quicker payments, the organization has been experimenting with blockchain, DLT, and central bank digital currencies (CBDCs).

Chainlink stated that by working with SWIFT, financial institutions are able to implement blockchain technology without having to replace, create, and integrate new links into legacy systems, which would necessitate "exceptionally high" costs and major alterations.

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SWIFT won't likely still exist in five years, according to Mastercard CEO Michael Miebach, who made the statement during a panel discussion on CBDCs in May. This is most likely because of increased competition from CBDCs for cross-border payments and settlements.

Miebach then issued an apology to Mastercard, clarifying that he had only intended to say that SWIFT's operations would continue to change from their existing configuration.

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