The Future is Cross-Chain: SWIFT adopts Chainlink's CCIP
Chainlink's cross-chain interoperability protocol (CCIP) will be employed by messaging network, SWIFT.
The Society for Worldwide Interbank Financial Telecommunication (SWIFT), an indispensable pillar of global finance, and Chainlink, a decentralized smart contract oracle network, are partnering on a cross-chain interoperability protocol (CCIP) in an initial proof of concept (PoC), to facilitate the interoperability of SWIFT on all blockchain environments.
CCIP will enable 11,000+ global SWIFT member institutions to securely and efficiently integrate with different chains, helping the interbank network conduct on-chain token transfers, however, without the security risk associated with cross-chain bridges. "This will help accelerate the adoption of distributed ledger technology (DLT) blockchains and benefit various institutions across capital markets," said Chainlink co-founder Sergey Nazarov.
On Sept. 28, at the SmartCon 2022 conference in New York City, SWIFT’s Strategy Director, Jonathan Ehrenfeld Solé disclosed that Swift and Chainlink labs started working together about 5-7 years ago. At a time before financial services on chain became a hot button issue, the duo successfully developed a proof-of-concept system for bond issuance and redemption.
While cross-chain bridges have provided a standard for blockchain communication, allowing users to move crypto assets from one chain to another, these bridges are vulnerable as their different designs present subtle attack vectors that may be exploited by hackers. According to Chainalysis, bridge hacks accounted for more than $2 billion this year.
Unsurprisingly, Sergey Nazarov is undaunted in his quest for a cross-chain future. Speaking to Fortune at Smartcon 2022 in New York:
I don’t think there have been bridges that have generated the necessary security. But that is what CCIP seeks to solve. And I don’t think it’s an intractable problem. I think it’s a solvable problem.
The demand for moving crypto assets from one chain to another is on the rise, SWIFT's adoption of CCIP could allow the protocol to become an outpost of progressive agenda, to bridge the gap between conventional banks and blockchains. Cross-chain integration is fraught with many challenges, but, Chainlink Labs has picked up the gauntlet.