As per a recent press release, Swift, UBS Asset Management, and Chainlink have successfully completed a pilot project demonstrating how tokenized fund subscriptions and redemptions can be settled via the Swift network, allowing transactions to bridge digital assets with fiat payment systems. This initiative could open up new possibilities for over 11,500 financial institutions across 200+ countries, providing streamlined transaction processing for tokenized assets in a globally connected financial system.

Traditional fund operations often encounter inefficiencies in subscription and redemption processes, including manual work, delayed settlements, and limited real-time transparency. These limitations lead to higher operational costs, lower liquidity, and missed opportunities within the $63 trillion global mutual fund industry. The recent pilot addresses these issues by showcasing how blockchain technology, the Chainlink platform, and Swift’s extensive network can support direct processing of tokenized fund transactions. This approach allows the payment leg of the process to proceed without requiring global adoption of an on-chain payment form, fully automating the fund subscription and redemption lifecycle.

The pilot extends earlier efforts with UBS Asset Management and SBI Digital Markets in developing a Digital Subscription and Redemption system specifically for tokenized funds, aligned with the Monetary Authority of Singapore’s (MAS) Project Guardian. Project Guardian is a collaborative global initiative that includes policymakers and financial industry leaders working to improve market liquidity and efficiency through asset tokenization. In this pilot, Swift’s infrastructure managed end-to-end payment orchestration for fund subscriptions and redemptions, while Chainlink’s platform enabled essential interactions across participants, ensuring UBS tokenized funds could automatically mint or burn tokens for investors.

Jonathan Ehrenfeld, Head of Strategy at Swift, emphasized the project’s importance: “For digital assets to be adopted globally, they must seamlessly integrate with both existing payment systems and digital currencies. Our work with UBS Asset Management and Chainlink as part of MAS’ Project Guardian leverages Swift’s global network to bridge digital assets with established systems, helping our community of financial institutions transact securely and scalably across various digital asset classes and currencies.”

Sergey Nazarov, Co-Founder of Chainlink, highlighted the broader impact: “Chainlink is enabling institutions to reuse Swift’s infrastructure for digital asset transaction payments. I’m excited about the adoption of these off-chain payment capabilities and their potential to increase capital flows and expand the user base for digital assets.”

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