- Swift, Chainlink, and UBS pilot streamlined tokenized fund settlements, merging blockchain with TradFi systems.
- Automated token processes reduce costs, boost liquidity, and enhance transaction efficiency for mutual funds.
- MAS’s Project Guardian shows how traditional finance can adopt blockchain, bridging digital assets with Swift.
Global financial messaging leader Swift, blockchain company Chainlink, and UBS Asset Management have concluded a significant pilot under the Monetary Authority of Singapore’s (MAS) Project Guardian.
This pilot explored efficient fiat cash settlements for tokenized funds, showcasing how Swift’s infrastructure can support off-chain cash settlements alongside blockchain technology. This move highlights the potential of blockchain in complementing traditional financial frameworks instead of replacing them.
Simplifying Tokenized Fund Subscriptions
This project demonstrated that TradFi investors could access tokenized funds without relying on stablecoins, central bank digital currencies (CBDCs), or other digital assets. Instead, Swift enables tokenized fund transactions through a familiar transfer process.
According to Chainlink co-founder Sergey Nazarov, this approach opens up opportunities for institutional investors who seek blockchain advantages while maintaining a connection with established finance systems.
Automated Token Processes Enhance Efficiency
Swift and Chainlink also streamlined the process of minting and burning tokens for UBS’s tokenized funds. This automation allows direct processing of fund subscriptions and redemptions, reducing delays and manual interventions in global mutual fund operations.
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This improvement in transaction efficiency addresses critical industry challenges, including operational costs, liquidity, and the timing of investments.
Industry-Wide Digital Asset Integration
Incorporating existing Swift infrastructure, the pilot aligns with MAS’s Project Guardian, a program fostering industry collaboration for asset tokenization. Swift’s Head of Strategy, Jonathan Ehrenfeld, stated that the integration of digital assets within established systems is essential for broad adoption.
This initiative supports Swift’s mission to offer secure and scalable digital transaction capabilities.
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