Global payments cooperative Swift announced the launch of a blockchain-based shared ledger with more than 30 global banks and Consensys, aiming to deliver instant, 24/7 cross-border transactions.
The ledger will use smart contracts, programs that automatically enforce transaction rules, and is positioned as a direct answer to competition from stablecoins.
Swift unveils shared ledger to counter stablecoins
The $300 billion stablecoin market, dominated by dollar-pegged tokens, enables users to transfer funds directly without intermediaries. Swift framed its initiative as essential to preserve relevance as regulators tighten oversight.
European banks have also outlined plans for a euro-denominated stablecoin by 2026, underscoring the pressure on legacy payment systems.
Swift said the shared ledger will record, sequence, and validate transactions, integrating compliance data through ISO 20022 messaging. This approach seeks to merge blockchain programmability with the predictability and transparency expected in regulated banking.
Swift stressed that the initiative will run in parallel with upgrades to existing fiat rails, allowing institutions to choose between traditional and tokenized infrastructure.
Partners, Pilots, and Pushback
Consensys, the developer of Ethereum layer-2 Linea, will build the prototype. Linea uses zero-knowledge cryptography to batch transactions for speed and privacy. Swift and banks earlier tested on-chain messaging on Linea to explore how blockchain settlement could comply with regulatory standards.
Separately, Chainlink highlighted its ongoing collaboration with Swift, including pilots with UBS and Euroclear that demonstrated tokenized fund subscriptions. While distinct from the shared ledger, these projects show how Swift may extend connectivity across public and private blockchains through partnerships.
“We’re beyond experiments now. The question is how to scale—regardless of whether the instrument is a tokenized deposit, a CBDC, a stablecoin, or a tokenized fund. It comes down to what exactly we’re connecting and where the value shows up,” said Swift executive Tom Zschach.
Supporters argued the ledger could cut reconciliation costs, enhance transparency, and allow programmable settlement that triggers automatically.
Critics warn, however, that banks must absorb integration costs, manage operational risks, and ensure legal finality—recognition by courts that a transaction is irrevocable. Swift executives acknowledge these hurdles but emphasize that broad adoption will depend on aligning blockchain confirmations with established legal standards.
Swift plans phased rollouts with banks to determine which currencies and corridors to prioritize. If successful, the project could reshape global settlement by embedding compliance into digital rails, offering banks a faster alternative to stablecoins while preserving the trust of traditional systems.
The post Swift and ConsenSys Launch Blockchain Ledger to Take On Stablecoins appeared first on BeInCrypto.