- Swift, UBS Asset Management, and Chainlink have completed a pilot using blockchain technology to integrate tokenized fund operations with traditional payment systems
- The project, part of the Monetary Authority of Singapore’s Project Guardian, showed successful settlements of tokenized fund transactions using existing Swift infrastructure
- This initiative enables seamless, automated fund operations without needing global adoption of on-chain payments
Swift, UBS Asset Management, and Chainlink have pioneered a pilot to bridge blockchain-based fund operations with conventional payment systems. The pilot, run under the Monetary Authority of Singapore’ (MAS) Project Guardian, demonstrated that tokenized fund subscriptions and redemptions can integrate with fiat systems, enhancing efficiency in traditional finance. The pilot comes five years after Swift labeled cryptocurrencies “useless and unstable.”
Three-way Pilot Reaps Dividends
Swift announced the pilot yesterday, which it said reduced manual processes and boosted efficiency. The pilot used existing Swift infrastructure, having previously demonstrated how its infrastructure can provide a secure, scalable way for financial institutions to connect to multiple types of blockchain.
This latest pilot with Chainlink’s platform orchestrated the necessary interactions between each of the respective actors to fulfil the pre-conditions for which a UBS tokenized investment fund will automatically mint or burn fund tokens for investors.
Jonathan Ehrenfeld, Head of Strategy at Swift, emphasized the vision behind this initiative in a press release, noting, “For digital assets to be adopted globally, they must seamlessly integrate with existing payment systems.” He added that this project underscores Swift’s commitment to providing financial institutions a secure bridge to digital assets using well-established systems.
Chainlink’s Pivotal Role
Chainlink’s co-founder Sergey Nazarov praised the pilot’s success, stating, “Chainlink is enabling institutions to leverage Swift’s infrastructure, facilitating digital asset payments and expanding capital flow.” The integration showcased how blockchain’s transparency and automation can modernize asset management without overhauling existing payment structures.
This innovative pilot indicates a step forward in blending cutting-edge blockchain technology with trusted financial networks, positioning Swift and its partners as leaders in enhancing financial system interoperability. The approach fosters broader access to tokenized assets, potentially reshaping the landscape of global asset management.
