SETL, the London based enterprise DLT and blockchain company, announced that it has successfully delivered an innovation pilot project for SWIFT which implemented a common framework linking tokenisation systems between CSD’s and global custodians. In a series of experiments, SETL, SWIFT, Clearstream, Northern Trust and other market participants explored the issuance, delivery versus payment (DVP), and redemption processes to support a frictionless and seamless tokenised asset market. The experiments used established forms of payment and central bank digital currencies (CBDCs).
The report including the results of this pilot will be published ahead of SWIFTS annual SIBOS conference.
Financial market infrastructures are already embracing tokenization by supporting the full lifecycle of digital securities. In fact, the market for tokenized assets is expected to reach 24 trillion USD by 2027. In response, SWIFT is undertaking a series of experiments alongside market participants from the tokenized and traditional asset ecosystem to explore how it can support the growth and development of the tokenized asset market.
One of the key risks in a world where tokenized and traditional assets co-exist is that it will create a multiplicity of technologies, platforms, and regulatory environments. SWIFT’s focus will therefore be on ensuring interoperability, interconnecting market participants, and simplifying their operations by completing activities centrally that would otherwise be performed bilaterally between institutions.
SETL worked with SWIFT and the other participants in a number of experiments involving the integration between the various DLT environments and with transaction orchestrations by using their PORTL suite of products. PORTL provides a robust and permissioned toolset for financial institutions to build applications that interoperate between existing infrastructures and a range of enterprise ledger technologies including Corda, Besu, Fabric, DAML and SETL’s own high-performance ledger.
Marjan Delatinne, Head of Payments, SETL said, “We are entering a pivotal moment of history by connecting the dots between SWIFT and the new tokenized world. This experiment could lay the foundation for universal interoperability between participants and systems during the transactional lifecycle of tokenized assets.”
Anthony Culligan, Chief Engineer at SETL stated, “We are very pleased to be contributing to this important initiative. We see significant innovation in securities tokenization at the moment and these experiments have the potential to create broader accessibility and interoperability between the emerging networks.”
Vikesh Patel, Head of Securities Strategy, SWIFT, said, “Our vision for instant and frictionless transactions not only applies to traditional securities instruments but also to new asset classes as well. The insights from this exercise with leading capital markets participants will help us define and prioritise the concrete steps required to enable seamless processes for tokenised assets.”
Philippe Morel, CEO of SETL, concluded: “At the beginning of the year we announced that the SETL-powered Regulated Liability Network (RLN) was proven to handle 1 million transactions per second, a result that dwarfs all other alternatives in sheer speed and scalability. We’re delighted to announce this important next step, cementing our position as a leader in the field of regulated tokens and bringing the reality of DLT adoption in financial markets, with all the benefits the technology promises, a little closer.”
