SWIFT issuing a stablecoin feels more panic driven than strategic. SWIFT is missing the insight that interoperability between competing stablecoins creates more messaging volume, not less. It essentially giving up on the "neutrality" it's been designed for.
Worst Case for SWIFT
- Each bank could build stablecoin capabilities
- Bilateral agreements replace SWIFT messaging with atomic settlements
- Consortium arrangements like JPMorgan Chase, Bank of America, Wells Fargo and Citigroup one, would bypass SWIFT
- SWIFT becomes legacy infrastructure for edge cases
-Free Banking run risk
Better approach to preserve nuetrality AND stay relevant?
-SWIFT should focus on updating messaging standards and governance, not currency issuance.
- Member banks continue to govern- no single bank controls the standard
-Adapt their compliance infrastructure to these new protocols
-Track reserve balances and monitor liquidity risk
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