SWIFT to launch live digital currency and tokenized asset trials in 2025

SWIFT, the global banking messaging network, announced plans to trial live transactions of tokenized assets and digital currencies in 2025.

This move marks a significant step towards integrating digital currencies and assets into the broader financial system, which has been slow to adopt these emerging technologies despite growing interest from banks and asset managers.

Over the past few years, financial institutions have explored the tokenization of traditional assets like bonds.

Tokenization involves creating digital units—often blockchain-based—that represent a portion of an underlying asset.

The goal is to make trading faster, cheaper, and more efficient by reducing the need for intermediaries. However, despite the potential benefits, tokenized assets have yet to achieve widespread adoption.

90% of central banks are currently testing CBDCs

In addition to banks, central banks around the world are also increasingly focused on digital currencies.

Approximately 90% of central banks are currently testing central bank digital currencies (CBDCs), which are digital versions of fiat money.

These CBDCs could facilitate the trading of tokenized assets and improve cross-border payment systems.

Central banks are keen to stay ahead of technological advances, such as cryptocurrencies like Bitcoin, which have challenged traditional financial systems.

SWIFT has been at the forefront of these developments, conducting trials for both CBDCs and tokenized assets.

Earlier this year, the organization announced plans to launch a new platform aimed at connecting CBDCs under development to the existing global financial infrastructure.

Nick Kerigan, SWIFT’s Head of Innovation, emphasized the growing demand from the financial industry to move beyond the trial phase and into live transactions.

“We now see industry demand to move out of that trial phase and see a digital asset move, and have a counterparty pay them in real money against that. That’s the stage we’re moving to next year, albeit in a controlled way,” Kerigan was quoted as saying by Reuters.

While the potential of tokenized assets and digital currencies is significant, the fragmented nature of the market has been a barrier to wider adoption.

Most initiatives have remained confined to internal banking systems, and only a few have progressed beyond the testing phase.

Central banks, for instance, are currently experimenting with wholesale CBDCs for cross-border payments, but these trials are limited to small groups.

What does SWIFT’s new initiative aim to achieve?

SWIFT’s new initiative aims to connect different types of digital assets and platforms, enabling more comprehensive integration.

“To successfully trade and settle a tokenized bond transaction, you need the cash, and that’s where a tokenized deposit or wholesale CBDC comes in,” Kerigan noted. “It’s not enough if you just have delivery or just payment—you need both.”

The forthcoming trials will be a crucial test for the global financial system as it adapts to the rise of digital currencies and assets.

If successful, the move could pave the way for more widespread use of tokenized assets and CBDCs, potentially transforming how financial transactions are conducted on a global scale.

As the financial world watches closely, SWIFT’s trials could play a pivotal role in shaping the future of digital finance and further bridge the gap between traditional and digital banking systems.

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