Sergey Nazarov, co-founder of Chainlink, confirmed today that the integration of Swift’s traditional payment system with blockchain technology has reached a production-ready stage.
Nazarov made this crucial revelation at the Sibos 2024 conference currently taking place at the China National Convention Center in Beijing. This year’s Sibos brings together financial services leaders from around the world. Nazarov’s announcement marks an important milestone for digital asset transactions in the traditional financial world.
Chainlink Swift Blockchain Payment Integration for TradFi
Chainlink has been working with Swift for several years to enable the use of Swift messaging and standards to seamlessly interact with blockchains. Nazarov emphasized that the once conceptual blockchain integration has now moved into a pre-production phase, allowing institutions to begin testing in the real world.
“We are now at a point where this system is ready to be integrated with your existing institutional systems,” he said during his keynote speech.
The system works through a pre-settlement phase, where traditional Swift messages communicate transaction details such as settlement status and intent. After this, the process shifts to the blockchain, where Chainlink facilitates the conversion of Swift messages to on-chain events.
Nazarov explained that this integration allows financial institutions to use Swift’s existing infrastructure for blockchain transactions, whether for tokenized funds, real-world assets or central bank digital currencies.
The innovation lies in the ability to reuse Swift’s off-chain payment system to settle digital asset transactions, making it easier for institutions to adopt blockchain technology without overhauling their current operations.
Financial institutions can test Chainlink-Swift payment integration
As a key part of this new process, Chainlink converts payment confirmation messages from Swift into on-chain events, allowing traditional payments to settle digital assets. The system also ensures that assets are unlocked and transferred on-chain upon confirmation of payment.
Slide from the presentation of the co-founders of Chainlink
“This isn’t just a concept or a plan – it’s a product you can integrate today,” Nazarov emphasized. The demo system is available at Chainlink’s booth at Sibos, allowing financial institutions to see first-hand how Swift messages can be used for blockchain interactions at minimal cost.
Chainlink (LINK) Price Action
However, this crucial announcement from Chainlink has yet to positively impact the market value of its original asset, LINK. At the time of writing, LINK is trading at $11.37, down 7% in the last 24 hours.