SWIFT and Symbiont collaborate to pilot a blockchain project
SWIFT and Symbiont collaborate to pilot a blockchain project that uses blockchain technology to reduce inefficiency?in communicating significant corporate data. This alliance was announced on Tuesday. Among the businesses taking part in the program are Northern Trust, American Century Investments, Citigroup, and Vanguard.
Using blockchain technology, the Society for Worldwide Interbank Financial Telecommunication (SWIFT) and US fintech technology company?Symbiont will give financial firms more precise?financial data?with the use of blockchain technology. The pilot project aims to help providers distribute data in near-real time to global custody clients, according to the announcement. The Assembly platform from Symbiont will leverage the global network of 11,000+ SWIFT-connected institutions to create a network effect. According to SWIFT's post, the partnership will increase the efficiencies in communicating “significant corporate events," including dividend payments and mergers.
Symbiont's Assembly and smart contracts, combined with SWIFT's extensive network, allow SWIFT to automatically harmonize corporate action event data from multiple sources, explained Tom Zschach, SWIFT's chief innovation officer. In addition, Assembly’s smart contract would allow participants to compare information and flag discrepancies, contradictions, or inconsistencies across custodians.
The message system processes over five billion transactions a year and integrates disruptive technologies to maintain relevance. A blockchain-based messaging system is being tested by SWIFT, the messaging system used by financial institutions globally to transmit instructions on tens of millions of transactions daily.
SWIFT facilitates trillions of dollars' worth of transactions by delivering secure messages to 11,000 businesses in more than 200 countries and territories.
Early in the year, when Ukraine was invaded by Russia, conflict broke out, and significant attention was paid to the operation. Numerous Russian banks' attempts to move money and conduct business internationally were hampered when the US and Europe removed them from SWIFT. SWIFT and the Bank of International Settlements are already working together to investigate the advantages of having a uniform language for international payments.
To facilitate communication between banks in diverse nations, SWIFT was established. The private network was made to be more secure, and all of its signals adhered to a protocol that enabled banks all over the world to instantly understand them. But it hasn't been impervious to attacks; cybercriminals have exploited it to pull off heists, demonstrating that any system can be broken into.
Blockchain technology is made available by Symbiont to address inefficiencies in the banking industry. If it is a success, SWIFT will broaden it to include more business events and consider making it available to the entire SWIFT community. The pilot is now being developed, and in September it will be tested and given feedback by a small number of participants.
CBW - External Analyst