Swift’s blockchain-based ledger may be ready for live payments, but banks still need their own digital-asset infrastructure before they can plug into it, according to Taurus co-founder and managing partner Lamine Brahimi.
In an interview with CoinDesk, Brahimi said banks need three things in place before connecting to the Swift ledger: their own permissioned ledger, wallet capabilities, and tokenization and smart-contract capabilities.
“If you want to connect today to the Swift ledger, you need three things,” Brahimi said. “You need your own permissioned ledger that interacts with that of Swift, you need wallet capabilities, and you also need tokenization and smart-contract capabilities to be able to integrate the Swift smart contracts.”
That requirement means Swift’s ledger is not a replacement for a bank’s internal systems. Brahimi described it as an orchestration layer built to let institutions move tokenized deposits across borders around the clock, while final settlement continues through existing arrangements. Banks still need systems to hold and manage tokenized deposits, along with digital-asset wallets and the smart contracts used in the process.
Swift’s ledger is designed as an orchestration layer
The ledger enables 24/7 cross-border transfers of tokenized deposits, but it does not replace banks’ internal infrastructure or current settlement setups. Its role is to coordinate and standardize the movement of tokenized deposits rather than take over the full stack inside each institution.
Swift said in July that 17 banks were preparing live tokenized-deposit transactions. The move marked its first step toward modernizing the bank messaging system that has dominated traditional finance since the 1970s. Swift still handles money flows of as much as $1.5 quadrillion a year.
Live transactions have already been completed
HSBC and Standard Chartered completed the first live interbank transaction using Swift’s ledger in August. Later, DBS and Citi executed a weekend cross-border dollar payment that settled in minutes instead of taking as long as two business days.
Those transactions showed that the ledger can support faster cross-border payments, including outside standard weekday banking hours. Even so, the banks that want to connect still need the internal digital-asset tools Brahimi outlined.
Brahimi says the extra technology is not necessarily a major hurdle
Brahimi said the added technology should not automatically be seen as a major obstacle for banks that already issue digital assets or manage them. He also said he does not expect the requirement to stop Swift from maintaining its dominant position in its sector.
He argued that the need for extra infrastructure should not be read as a weakness in Swift’s design. In his view, the ledger remains an early-stage product, but it gives banks a choice between existing payment rails and tokenized deposits that can move around the clock.
“I think it’s a good move,” he said. “That provides the choice.”
Taurus says it can provide the three required layers on one platform
Taurus announced its Swift integration in August. Brahimi said the firm offers the three required layers through a single platform: a permissioned ledger, wallet-management tools, and tokenization and smart-contract software.
He added that competing providers may require banks to work with multiple vendors to cover those functions.
Why tokenized deposits remain mostly institutional
The infrastructure requirement also helps explain why tokenized deposits remain largely an institutional product. Banks have used internal tokenized-deposit systems for years, but moving money between institutions requires shared standards and compatible systems on both sides.
“Tokenized deposits until Swift’s announcement were barely used,” Brahimi said. “They were mostly used by huge banks like JPMorgan, because they had such a big global scale.”
Swift’s model keeps deposits on banks’ balance sheets, which sets it apart from stablecoins issued outside the banking system. Brahimi also said the ledger could give banks a standardized way to offer 24/7 payments without abandoning their existing infrastructure.