The Swift financial transactions services provider is getting ready to use digital currencies. Since 2021, the company has been testing a platform to trade CBDCs, as digital currencies issued by central banks are called.
The service will be integrated with central banks worldwide, besides two private banks that are part of the project. All indications are that the CBDC platform will be officially launched on the market in 2023.
The data management of the Swift platform will be centralized and rely on an association with 14 central banks. The two private banks that are part of the project are HSBC and UBS.
Together, the banking institutions are part of the testing phase of the platform’s pilot project, which has been running for eight months. Swift proposes to offer a platform that can convert CBDCs into cash.
Swift has also confirmed that the service with CBDCs will have only one database connection.
CBDCs in advanced stages of testing
While these details are yet to be worked out, some countries are already in the advanced stages of testing. One of these is Nigeria, for example. The African country is developing its own CBDC and hopes to launch it on the market soon.
Meanwhile, China has already tested the digital yuan, and during the Winter Olympics, the digital currency was used by athletes and visitors.
Swift can also use its customer base to expand the use of CBDCs around the world. The company is present in more than 200 countries and has partnerships with more than 11 thousand banking institutions.
Despite the advances related to CBDCs, some authorities still do not see this alternative as the best option in the crypto world. For example, the president of the Reserve Bank of Australia believes that stablecoins are better alternatives.