In collaboration with UBS Asset Management and Chainlink, Swift has concluded a pilot program aimed at simplifying tokenized fund transactions using its existing financial network.
This initiative, launched under Singapore’s Project Guardian, explored how blockchain technology could integrate digital assets with the fiat payment systems used by over 11,500 financial institutions worldwide.
The goal was to address common delays and inefficiencies in fund operations by automating subscription and redemption processes, thereby lowering costs and increasing transparency, according to the Swift press release.
Tokenized funds are an emerging approach in finance, where traditional assets—such as mutual funds or stocks—are represented digitally on a blockchain. This allows for automated transactions and, ideally, faster and more secure processes.
Swift’s established infrastructure
The pilot focused on enabling the subscription and redemption of these tokenized funds without requiring a universal blockchain-based payment system. Instead, it demonstrated how Swift’s existing infrastructure could support transactions by orchestrating fiat payments for digital assets.
Traditional fund operations often involve manual steps and lack real-time transparency, leading to higher costs and missed investment opportunities. Through this pilot, Swift, UBS, and Chainlink (LINK) showcased how blockchain technology could streamline these processes, creating a more efficient system.
The collaboration used Chainlink’s technology for blockchain interactions and Swift’s network for fiat payments, achieving end-to-end automation without disrupting existing systems.
This pilot is part of a broader effort by Singapore’s Monetary Authority and industry participants to enhance the efficiency and liquidity of financial markets.
