Finance has spent a thousand years trying to move wealth virtually. But every time innovators engineer a faster, more secure way to transfer capital, malicious actors hit back with new, sometimes highly sophisticated, attack vectors.
For over 50 years, the messaging system developed by the Society for Worldwide Interbank Financial Telecommunications (Swift) has been the dominant infrastructure for cross-border settlement, routing roughly $5 trillion daily. However, facing pressure to improve speed, reduce cost and compete with the growing number of blockchain rivals, the bank-owned organization is under pressure to evolve.
In recent years, stablecoins and tokenized deposits have emerged as potential “SWIFT killers”, a phrase coined in a 2017 Brave New Coin analysis about Ripple, a blockchain designed to handle cross-border transactions. It took almost nine years for Swift to respond. Just last month, it unveiled a blockchain ledger and, shortly after, HSBC and Standard Chartered executed the first live transaction, settling in seconds rather than days.
Swift’s potential inspiration
In the 8th century, Islamic merchants moving goods between Baghdad, Cairo and the Indian subcontinent had a problem. Moving gold physically was dangerous, with bandits on the lookout for victims. No amount of armed escorts could solve that issue.
