The Society for Worldwide Interbank Financial Telecommunication (SWIFT) network has announced a partnership with the blockchain firm R3. Specifically, SWIFT global payments innovation (gpi) which is used by hundreds of banks and settles $300 billion of cross-border payments daily, will be linked with R3’s Corda platform during a proof of concept trial. This will be called gpi Link.
The CEO of SWIFT, Gottfried Leibbrandt, made this announcement while sitting next to Ripple CEO Brad Garlinghouse. Garlinghouse indicated Ripple is open to working with SWIFT, although no direct partnership has been announced. That said, R3’s Corda Settler integrates Ripple (XRP) as an asset.
R3 tweeted that the SWIFT gpi Link partnership will integrate Corda Settler, making it possible that banks and firms using gpi Link can choose to make payments with Ripple (XRP).
— inside_r3 (@inside_r3) January 30, 2019
Ripple (XRP) rallied 11 percent yesterday following the SWIFT gpi Link announcement, and this may be partially responsible for the broader crypto rally today.
Chart courtesy CoinMarketCap.
“Following the recent launch of our Corda Settler, allowing for the payment of obligations raised on the Corda platform, it was a logical extension to plug into SWIFT gpi,” said David E. Rutter, CEO of R3. “SWIFT gpi has rapidly become the new standard to settle payments right across the world. All the blockchain applications running on Corda will thus benefit from the fast, secure and transparent settlement provided through the SWIFT gpi banks”
SWIFT still appears hesitant to integrate Ripple (XRP) or any other cryptocurrency, and the theory that gpi Link will result in SWIFT using Ripple (XRP) is not guaranteed.
“I think that the big part of Ripple’s value proposition is the cryptocurrency XRP,” Leibbrandt said regarding Ripple (XRP). “There, we do find the banks are hesitant to convert things into a cryptocurrency right now because of the volatility in the currencies.”
“All trade platforms require tight linkages with trusted, fast and secure cross-border payments mechanisms such as gpi,” said Luc Meurant, chief marketing officer of SWIFT. “While DLT-enabled trade is taking off, there is still little appetite for settlement in crypto-currencies and a pressing need for fast and safe settlement in fiat currencies”.
Regardless of whether Ripple (XRP) ends up being used by SWIFT at some point via gpi Link, this is a major leap for blockchain technology in general. Via R3’s Corda, blockchain technology will be used to authorize and settle SWIFT gpi Link payments. The blockchain technology of Corda will ensure speed, security, and transparency.
In the announcement SWIFT indicates this is just the beginning of its expansion into blockchain and distributed ledger technology (DLT), and more platforms could be integrated into gpi Link in the future.