SWIFT’s native blockchain ledger recently enrolled quite a solid roster of banks to test their cross-border transaction settlement. The first pilot involves HSBC & Standard Chartered, two major UK banks deploying their tokenized deposit platforms on SWIFT.
How XRP Pins Into SWIFT’s Cross-Border Testing
These two SWIFT-compliant banks are also long-term partners of Ripple, the issuer of XRP. Specifically for HSBC, the bank has a concrete technological relationship with Ripple through Metaco, the Swiss digital-asset custody firm that Ripple successfully acquired back in 2023.
- HSBC uses Metaco’s Harmonize platform for institutional digital-asset custody, including tokenized securities and related services.
- This partnership was publicly announced and is already live for HSBC’s institutional clients with complimentary ODL usage.
- Standard Chartered’s Zodia Custody has also been associated with the same Metaco network in some reports.
However, it’s important to draw the distinction between Ripple’s HSBC-Metaco relationship and the On-Demand Liquidity (ODL) technology, employing the native XRP token by default. HSBC’s custody deal via Metaco sits on a different part of Ripple’s tech stack.
Technically, XRP can be used as a bridge asset, enabling real-time cross-border payment flows without SWIFT’s regular processing windows of 1 to 4 business days. There’s no concrete evidence that HSBC tested out Ripple’s ODL service already, but the 24/7 global economy is getting stronger by the hour.
The Inaugural Transaction Putting Banks On Edge
SWIFT’s centered their technical improvements around interoperability. Since launching their own native blockchain ledger this year, the top European financial conglomerate urged crypto companies to collaborate with SWIFT-compliant banks in order to make transfers instantaneous.
Today, the first transaction was conducted through the exchange of payment messages between HSBC and Standard Chartered using SWIFT’s ledger. The resulting obligations were recorded on-chain as tokenised deposit obligations on both HSBC’s Tokenised Deposit Service (TDS) and Standard Chartered’s tokenised-deposit infrastructure.
SWIFT’s blockchain-based ledger acted as a secure orchestration layer, enabling the obligations to be matched and netted between the two active banks prior to final settlement through existing systems. While XRP’s use in this is complimentary, the first successful cross-border transaction sets an example of cost-effectiveness in a quickly-evolving market niche.
Dive into DailyCoin’s popular crypto news today:
Bitcoin Price Breakout: U.S. Treasury Pivot Sparks Rally Above $69K
Global Bond Yields Hit Multi-Decade Highs. What It Means for Bitcoin