Standard Chartered and Deutsche Bank pilot SWIFT alternative

Monday 30 October 2023 11:38 CET | News

Deutsche Bank and Standard Chartered have collaborated to test a system that will allow blockchain-based transactions, stablecoins, and CBDCs to talk to one another. 

This functionality is taking an approach similar to the SWIFT messaging layer in traditional banking infrastructure. 

The banks are running a series of test cases, including transferring and swapping USDC stablecoins, on the Universal Digital Payments Network (UDPN), a permissioned blockchain system composed of validator nodes run by an alliance of banks, financial institutions, and consultancies.

Deutsche Bank and Standard Chartered have collaborated to test a system that will allow blockchain-based transactions, stablecoins, and CBDCs to talk to one another.

Created by tech consultancy GFT Group and Red Date Technology, the system instructs and allows transactions to occur across a spectrum of networks, ranging from stablecoins on public blockchains to CBDCs. 

As per the official press release, the UDPN acts both as an interoperability bridge between various types of blockchain networks while also applying battle-tested decentralised digital identity standards (DIDs) to participants, with the aim to allow for a bank-friendly and regulated environment. 

The UDPN is a network where the affiliation of members is permissioned. However, the transactions themselves are placed onto the underlying infrastructure, which includes permissionless networks. For instance, when carrying out a cross-border currency transfer, the sending institution takes the tokenised value and transfers it into a smart contract managed by the UDPN, which will then release the intended target currency from that smart contract. 

The UDPN currently comprises about 25 organisations running around ten proof-of-concept tests in parallel. That group consists of banks from the USA, Australia, Latin America, and Europe. 

Other developments from Deutsche Bank 

In October 2023, Deutsche Bank announced that it had completed the acquisition of Numis in a bid to solidify its engagement with corporates across the UK. This move aligned with Deutsche Bank's Global Hausbank strategy, positioning it as the primary point of contact for clients in the financial services sector. The merger has given rise to Deutsche Numis, and it aims to facilitate deeper engagement with corporate entities throughout the UK.  

In September 2023, Deutsche Bank integrated technology from Taurus to globally establish digital asset custody and tokenization services. This collaboration followed an extensive selection process, during which Taurus successfully showcased the quality and extensive range of its products and technology. Taurus expressed excitement to establish this worldwide partnership with Deutsche Bank and assist the bank in introducing digital assets and DLT-based offerings across various booking centres. 

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Keywords: blockchain, CBDC, cryptocurrency, SWIFT, partnership
Categories: DeFi & Crypto & Web3
Companies: Deutsche Bank, Standard Chartered
Countries: World
This article is part of category

DeFi & Crypto & Web3

Deutsche Bank


Standard Chartered

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