SWIFT and Chainlink team up to connect financial institutions to blockchain

Blockchain is a game-changer for many industries. Instead of allowing themselves to be competed by this vague technology, financial firms are making an ally of it. This is the case of SWIFT, which has been working for several months to integrate the blockchain into its services.

A partnership to test blockchain interoperability for banks

The Society for Worldwide Interbank Financial Telecommunication (SWIFT) formalized its collaboration with Chainlink on Tuesday, June 6. Together, the two technology companies plan to test the connection of a handful of banks to the blockchain.

Among the banks targeted to be the subject of the test, we cite BNP Paribas, Citi Euroclear or Lloyds Banking Group. Depository Trust and Clearing Corporation (DTCC), Australia and New Zealand Banking Group Limited (ANZ) and Clearstream are also affected.

Concretely, this partnership envisages a specific type of test. It should essentially be about blockchain interoperability for banks. This is to see how effectively the targeted banks connect to multiple blockchain networks.

The objective is to eliminate the failures that banks may encounter with regard to the settlement of tokenized assets. A goal, which hides another, much more important this time, because it is economical.

Stakeholders believe blockchain adoption is helpful for “generate efficiency gains, reduce costs”. But it is above all a simplification of the process that could be of greater interest to private investors. This could ultimately increase profits.

By the way, Sergey Nazarov, co-founder of Chainlink, thinks that “Banks and their customers will grow the blockchain industry beyond $10 trillion”. This, because they hold “the largest volume of capital on a global scale”.

With a capitalization of $1.08 trillion (or $1,080 billion), the blockchain market has yet to grow. This is not possible without increased adoption which, moreover, continues to gain ground on a global scale.