Banking Giants Swift and Visa Unleash Stablecoin Alternatives

Swift, the bank-owned messaging network that has connected more than 11,500 financial institutions for 53 years, announced on July 9 that its blockchain-based shared ledger is ready for use. This ledger will support 24/7 cross-border payments using tokenized deposits, with an initial 17 banks across six continents set to pilot the system.

The key feature of this new system is that it uses tokenized deposits, which are commercial bank money represented on a blockchain and issued by a regulated bank. This means that final settlement still occurs through existing payment rails.

Swift's Chief Business Officer, Thierry Chilosi, said the move extends the trust and stability of established finance into the frontiers of digital money. However, it's worth noting that Swift explicitly framed the ledger as a way to compete with the emerging stablecoin industry.

In roughly the same window, a consortium of more than 140 companies led by Visa, Mastercard, Coinbase, BlackRock, and Stripe launched a dollar stablecoin called Open USD. This token is native to Solana and plans to launch this year.