The co-operative published the findings of a 12-week period of sandbox testing, in which almost 5,000 transactions were simulated between two different blockchain networks and with existing fiat-based payment systems.

Sandbox participants included the Banque de France, the Deutsche Bundesbank, the Monetary Authority of Singapore, BNP Paribas, HSBC, Intesa Sanpaolo, NatWest, Royal Bank of Canada, SMBC, Société Générale, Standard Chartered and UBS.

Tom Zschach, chief innovation officer at Swift, comments: “Our experiments have shown the critical role that Swift can play in a financial ecosystem in which digital and traditional currencies co-exist. Our API-based CBDC connector has been proven to be robust across almost 5,000 transactions between two different blockchain networks and traditional fiat currency, and we’re delighted to have the support of our community in developing it further. Many participants have made clear their desire for continued collaboration on interoperability, and this is particularly pleasing.”

He says Swift intends to develop a beta version of the solution for payments that can be tested further by central banks. A second phase of sandbox testing will also be held, in which the Swift member banks can collaborate further with a focus on new use cases, including in securities settlement, trade finance, and conditional payments.

Stefano Favale, executive director at Intesa Sanpaolo, says: “When it comes to CBDCs, interoperability becomes a key enabler to avoiding liquidity traps and creating a network effect. We truly believe that Swift, through its experience and capabilities, is the natural market-neutral candidate to support future digital asset developments.”