Swift's new platform to connect central banks to digital currency!

The need to complete cross-border transactions and global transactions is increasing day by day. Cryptocurrencies are growing in popularity over time. At present, the central governments of various countries are realizing the need for digital currency. And for that reason, the country's central banks have focused on creating a digital version of their own currency. We know that many countries have created their own fiat currencies these days. And with that, the messaging network Swift, associated with global bank management, has taken the initiative of a new platform to cope with this transformation. The new initiatives that are currently being discussed may be implemented within the next one-two years.

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We are quite familiar with the word Swift. It is an acronym that stands for Society for Worldwide Interbank Financial Telecommunications. It is mainly a banking service which is an international network for exchanging messages for fast financial transactions. At present it is quite secure. Here everything is done with confidentiality. It can be called a place of trust for many big investors or businessmen. Currently, the central banks of various countries can quickly complete high-quality financial transactions with safety and security. On the other hand, central banks are moving towards Central Bank Digital Currency or CBDC to transform the financial system into digital currency.

Currently, most of the world's central banks are working on digital versions of their national currencies. These currencies are said to be one of the reasons behind the digital version due to the popularity of Bitcoin or digital currencies these days. Currently, the price of Bitcoin is at the highest level in history. Also people are getting interested in digital currency day by day and investing in digital currency. So central banks do not want to be left behind in keeping up with the current era. However, CBDC is yet to become self-sufficient due to technical complications. But currently SWIFT wants to mediate the entire process of these related transactions.

Swift has completed a six-month trial of the new platform to launch the new initiative. A team of 38 members from central banks, commercial banks and settlement platforms was involved in this process. However, CBDCs will not be the same for all countries. CBDCs will differ from country to country in terms of technology and protocol. We know that there is some risk involved in all these activities and therefore SWIFT is working to reduce the risk of transaction isolation. For that they have completed a 6 month trial and during that time, it can be seen that the SWIFT platform can be used for complex trading or forex transactions. It increases the speed of automated transactions, reducing costs. Banks will be able to digitally transact among themselves through CBDC. When SWIFT's new platform is launched, it will be the global connection point for banks, through which digital currency transactions can be easily done.

Countries such as the Bahamas, Nigeria and Jamaica have already introduced CBDCs. Currently CBDC is operational in many countries including India. The European Central Bank is also on track to launch a digital Euro One. The main advantage of SWIFT is that its existing network is usable in more than two hundred countries. At present, more than a trillion dollars are transacted in this channel every day by connecting many banks and funds. However, currently Swift has been withdrawn from Russia due to the war with Ukraine. The demand for digital or tokenized assets is constantly increasing in the world. Around $16 trillion worth of assets could be tokenized by 2030. In this process, assets like stocks and bonds will be converted into digital chips and can participate in real-time trades.