SWIFT revealed on March 25 that it found various uses for its central bank digital currency (CBDC) solution after a successful half-year test.

Rather than creating its own CBDC, SWIFT developed an interconnected solution for existing CBDCs known as the SWIFT connector.

The company stated: "At the heart of our solution is the DLT and smart contract layer, which keeps consistent transaction records."

The platform was described as having potential applications in digital trade, securities, and foreign trade. It was also mentioned that future versions of the platform could expand to areas beyond CBDCs, like bank-led tokenized deposit networks.

SWIFT highlighted specific use cases including trade payments, foreign exchange, delivery versus payment (DvP), and liquidity-saving mechanisms with smart contracts.

The sandbox solution by SWIFT utilized multiple digital ledger technology (DLT) networks, such as Hyperledger Besu, R3 Corda, and Hyperledger Fabric.

The platform incorporated atomic settlements and swaps, a settlement method with instant and simultaneous asset exchange. This type of settlement is similar to traditional financial networks' delivery versus payment (DVP).

Smart contracts were used to automatically ensure payments were executed upon meeting the conditions. All major use cases outlined by SWIFT involved smart contracts.

SWIFT described its sandbox test as one of the largest CBDC experiments to date, involving 38 institutions over six months. Network activity included over 125 sandbox users performing 750 transactions, with around 60 representatives from participating financial institutions attending 20 collaborative working group meetings.

The company intends to develop a production roadmap for the SWIFT connector, aligning progress with market developments and readiness.

Interest in CBDCs globally could make the SWIFT service appealing. Active CBDC countries include China, the Bahamas, Jamaica, and Nigeria, with over 130 other countries and regions exploring CBDCs, including recent advancements in Europe, the Philippines, and Spain.