Adoption in the global finance sector is increasingly propelled by scale and standardization, with a leading member-owned cooperative currently connecting over 11,000 institutions across more than 200 countries and territories. This network is crucial, as it facilitates 90% of cross-border payments to beneficiary banks.
In a significant development, SWIFT has stepped beyond experimental phases, now conducting live bank trials of digital-asset and digital-currency transactions. These trials utilize existing SWIFT connections across North America, Europe, and Asia, indicating a shift towards mainstream application.
Conversely, Ripple has been enhancing its presence within the regulated finance sphere, albeit without any public association with SWIFT. The company has set its sights on a roughly $200 million acquisition of Rail, emphasizing its strategy through 2025. Ripple is also launching its USD-backed stablecoin, RLUSD, in collaboration with partners in Africa and Japan, alongside initiatives in custody and tokenization—none of which require integration with SWIFT.
This evolution has reignited discussions within the industry, particularly regarding whether Ripple and SWIFT are on a collision course to compete or whether they may eventually converge. Robert Pehrson, Head of Products at SEB, remarked during a previous industry forum that the future of Ripple may involve integration with networks like SWIFT, rather than outright replacement.
The backdrop is significant, especially as SEB has previously utilized Ripple’s technology to enhance cross-border transfer speeds between Sweden and the United States. This experience has provided insights into how enterprise blockchains can be integrated with existing systems.
SWIFT is actively exploring the tokenized finance landscape by testing methods to transmit instructions for tokenized assets across various blockchains, all while ensuring that banks adhere to familiar controls and standards. In 2023, SWIFT announced successful experiments in collaboration with major institutions and Chainlink, aimed at connecting traditional financial systems with both public and private blockchains for the settlement of tokenized assets. This initiative seeks to illustrate that banks can conduct transactions seamlessly between traditional fiat systems and emerging digital currencies.
An essential component of any potential SWIFT-Ripple integration is the adoption of ISO 20022 standards. SWIFT has already initiated its migration to these standardized cross-border payment and reporting protocols, which commenced in March 2023 and is set to conclude in November 2025. This transition will mark the end of the coexistence period with legacy MT messages.
Should banks express interest in alignment between the two systems, a practical approach could involve message-level interoperability rather than a complete overhaul of either network. SWIFT could transport standardized payment instructions referencing settlements on blockchain networks like the XRP Ledger or through Ripple’s infrastructure. This would allow banks to continue using their existing SWIFT interfaces while optionally facilitating some transactions using tokenized instruments or stablecoins, where regulations and liquidity permit. This methodology appears consistent with how SWIFT has piloted tokenized assets—enhancing existing networks with interoperability modules.
