A new report from SWIFT details the settlement network operator's plan to develop a distributed ledger application platform.
The 20-page report, which was the result of research and development between SWIFT and professional services firm Accenture, includes new details on SWIFT’s proofs-of-concept focused on the technology. These include how it working on transaction settlement and identity management concepts that incorporate blockchain elements.
Notably, the paper outlines SWIFT's intention to create "a distinctive [distributed ledger technology] DLT platform" focused on financial applications, that it suggested it will build in collaboration with industry peers.
The paper's authors wrote:
"Drawing upon its long history of fostering industry collaboration, SWIFT will leverage its unique set of capabilities – unrivaled standards expertise and track record in security as well as our strong governance, operational efficiency, reliability and reach – to deliver a distinctive DLT platform offer for the benefit of its community."
Further, the paper argues that applications among financial institutions hinge on development in the areas of governance, data control, compliance, standards, identity, security, scalability and overall reliability.
To date, some of SWIFT’s most visible work on blockchain applications comes as part of the Hyperledger project, the open-source initiative led by the Linux Foundation.
But, the paper offers a look at some of the other trials being conducted by the network in its innovation labs, including applications focused on identity and settlement.
One application described as an "Identity and Access Management" concept, for example, uses a distributed ledger.
"This PoC integrates a DLT solution with a SWIFTNet PKI solution and access control mechanism (such as a closed user group and RMA) to demonstrate how SWIFT can leverage its existing platform and assets to solve the identity and access management issues highlighted as part of our technology assessment," the paper states.
According to SWIFT, these PoCs will play a role in the platform it seeks to build.
"The areas covered in the PoCs should be considered as illustrative to prove the capabilities of the technology and support SWIFT’s work to build a DLT platform which is standardised and use case agnostic," the company said.
Push for collaboration
Throughout the report, SWIFT and Accenture push for industry stakeholders to work collaboratively on blockchain applications. This, the argument goes, will ensure the greatest degree of interoperability between networks and institutions running their own ledgers.
"It is clear that industry-standard DLTs should be developed collaboratively with the industry in order to ensure the technology can be universally adopted," the paper states.
One angle of this issue, according to the paper, lies in the area of reducing costs and overall risks for those involved with development and deploying applications.
"At the request of its community, SWIFT is heavily investing in building a complete compliance portfolio for its community. Compliance is a challenge shared by all financial institutions, and one that is best met together," the paper states, concluding:
"Since investments in financial crime compliance do not yield competitive advantage, it makes sense to collaborate to mitigate costs and risks for all parties."
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