Swift, a bank messaging network, recently released a report that explores how it can connect with blockchains and solve the issue of interoperability between different blockchain networks. The report, titled “Connecting blockchains: Overcoming fragmentation in tokenised assets,” concluded that a more incremental approach that interlinks existing systems to blockchains is “more plausible” for market development in the near term.
Swift highlighted that there is a “lack of secure interoperability” between different blockchain networks, leading to various inefficiencies and poor user experience. To demonstrate its ability to provide a single point of access to multiple networks using existing infrastructure, Swift worked with various financial institutions and blockchain oracle network provider Chainlink. This significantly reduces operational challenges and costs for institutions to support tokenized assets.
Tom Zschach, Swift’s chief innovation officer, said that tokenization can reach its full potential once institutions can connect to the whole financial ecosystem. He added that existing secure and trusted Swift infrastructure can provide that central point of connectivity, removing a huge hurdle in the development of tokenization and unlocking its potential.
The report pointed toward many potential benefits of tokenization, such as increased liquidity and automation, enhanced transparency and security. However, Swift noted that there are significant hurdles such as legal and regulatory frameworks still under development, which remain a challenge for institutions when diving into making tokenized asset transactions.
This News Article was automatically generated by Bob the Bot (AI)
| Information | Details |
|---|---|
| Geography | Global |
| Countries | 🇸🇬 🇺🇸 |
| Sentiment | neutral |
| Relevance Score | 8 |
| People | Tom Zschach |
| Companies | Swift, Singapore central bank, Tom Zschach, SEC, Chainlink |
| Currencies | None |
| Securities | None |
