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SWIFT Financial-Messaging System Pilots Blockchain Project (bloomberg.com) 17

SWIFT, the messaging system used by financial institutions globally to convey instructions on tens of millions of transactions each day, is testing out blockchain. From a report: The Society for Worldwide Interbank Financial Telecommunication, or SWIFT for short, is piloting a project with fintech company Symbiont, according to a post seen by Bloomberg. The collaboration, which includes Citigroup, Vanguard and Northern Trust, is aimed at driving "efficiencies in communicating significant corporate events," like dividend payments and mergers, SWIFT said in its post. As a global financial artery, SWIFT delivers secure messages among 11,000 companies in over 200 countries and territories, directing trillions of dollars in transactions. The operation gained much attention earlier this year as war broke out in Ukraine following Russia's invasion. The US and Europe cut a number of Russian banks from SWIFT, hurting their efforts to move money and operate globally.
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SWIFT Financial-Messaging System Pilots Blockchain Project

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  • by Urganite ( 888467 )
    OK
  • ... the business down the street. Big Ed's Auto Salvage and Blockchain Currency.

  • by rickb928 ( 945187 ) on Tuesday September 13, 2022 @01:16PM (#62878263) Homepage Journal

    ...cause they have competition, and their competitors are already faster, cheaper, and more responsive.

    All good for us, until 'they' turn our money all digital and own our accounts.

  • Whatever they are testing is almost certainly not a blockchain as most people understand it. It almost certainly is not a decentralized digital ledger that uses proof-of-whatever mining to secure transactions. Bitcoin processes 6 transactions per second and wastes as much electricity as a medium-sized country. I'm pretty certain that is not what SWIFT is planning to copy.
    • Isn't SWIFT's business model based on centralised, consolidated systems? Isn't that pretty much the opposite to the claims that blockchain proponents make?

      And yeah, where are they going to get the electricity from to run it on in Belgium? Europe's paying through the nose for energy at the moment & for the foreseeable future. Blockchain's staggeringly high energy consumption is already wildly inappropriate for the times we're living in, i.e. global heating & energy shortages.
      • by _merlin ( 160982 )

        Isn't SWIFT's business model based on centralised, consolidated systems?

        Not really. All SWIFT does is provide a messaging platform with a standard message format and authentication system. It doesn't really facilitate transactions per se, it just provides the messaging infrastructure between banks that have arrangements for transfers.

        • ...it just provides the messaging infrastructure between banks...

          Mmm...

          • by _merlin ( 160982 )

            My point is it isn't providing a transaction ledger or anything like that. There isn't really anything "centralised" as such. Their messaging system is distributed, and while it has redundant links to improve reliability for message delivery, parts of it can continue to operate in isolation if enough links are broken to cause the network to become fragmented. The service they provide is just routing and delivering messages, and enforcing a standard message format so the banks don't have to deal with a me

    • If they know what they're doing they will use XRP on a private ledger. Open source, barely any power required.
    • by gweihir ( 88907 )

      Yes, so? Blockchain has never meant crypto-"currency". That is just one possible application.

    • by ceoyoyo ( 59147 )

      It's probably SWIFT, but with digitally signed messages. Not a bad idea, probably well past when it should have been implemented. Perhaps they have a hash tree storing the transactions which, yeah, okay, sure.

  • Eh, maybe (Score:4, Informative)

    by Dan Posluns ( 794424 ) on Tuesday September 13, 2022 @01:54PM (#62878461) Homepage

    Of all the dumb uses for blockchain I've seen so far, this is perhaps *not* the dumbest. From the article, it looks like they're using the blockchain and smart-contract technology as a way to effectively standardize and distribute their various processing nodes around the world. Everything is still effectively centralized under SWIFT, but it's leveraging a framework that's inherently distributed to do things like signal conflicts and automate reconciliation in the ledger when possible, rather than relying on bespoke solutions for different products in different territories, etc.

    It's not actually a terrible application for blockchain, and by using a standardized set of APIs and open-source implementations it likely may be used to combat scenarios where some dude programmed an arcane one-off 20 years ago that's now the backbone of our financial system, and took all knowledge of it with him when he left. Just remove/ignore the parts of the spec that call for unnecessary proof-of-work/proof-of-stake to resolve conflicts and either outright reject them or rely on smart contracts instead, and you've effectively got a pretty reliable ledger system that scales and distributes to banks across the globe with very little effort.

    Can it be done without blockchain? Of course. Are there benefits to using blockchain? Maybe, for once, if only it means that they don't have to roll their own complicated software to do this kind of thing, and keep reinventing the wheel for each financial product they want to do it with.

    • I'd rather trust a proven implementation from yore than something piled together now by a troop of full-stack framework monkeys agitated by blockchain buzz.

    • This is the first time I've seen an announcement and thought, yeah that might be a good idea. It's been 20 years or so since I interacted with SWIFT but it was a pretty simple messaging platform at the time (I'm sure it's different now).

      I'm also waiting for a county recorder (or other similar entity) to do this for real estate ownership. Many of them already have a custom platform for the "transaction ledger" so perhaps this could save money over time.

      It would be a centralized / controlled blockchain, whi

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