Demonstrated by UBS, Chainlink has introduced technology that enables financial institutions to use Swift messages to instruct on-chain token transfers, helping the messaging network become interoperable across nearly all blockchain environments.
Operating across the Chainlink Runtime Environment, banks and institutions can access blockchains through the same Swift infrastructure they have relied upon for decades. This, says Chainlink, shows how institutions can access blockchains without needing to upgrade to new infrastructure, replace their existing processes, or integrate new identity and key management solutions.
A first use case involved a technical and operational pilot with UBS Tokenize, the in-house tokenization unit of UBS. Subscriptions and redemptions for a tokenized fund smart contract from UBS were triggered using ISO 20022 messages through CRE and Swift infrastructure. CRE received the Swift messages, which then triggered subscription and redemption workflows in the Chainlink Digital Transfer Agent (DTA) technical standard.
This new development builds on Swift, Chainlink, and UBS’ past tokenized asset use case in the Monetary Authority of Singapore’s (MAS) Project Guardian in 2024, demonstrating the technical and operational possibility for settlement of tokenized fund subscriptions and redemptions using offchain cash settlement via Swift.
The enhanced plug-and-play system goes one-step further by enabling institutions to use Swift messages to trigger onchain events more generically, unlocking last-mile connectivity.
Sergey Nazarov, co-founder of Chainlink, comments: “UBS is demonstrating how the use of smart contract-based technologies can be used by financial institutions to more readily explore new types of product lifecycle composability.
"The ability to seamlessly interact with complex onchain workflows through Swift messaging is a groundbreaking development reducing operational friction, supporting automated compliance, enhancing transparency, removing reconciliation burdens, and delivering efficiency gains through programmable infrastructure."