Garlinghouse pulled no punches as he detailed the shortcomings of SWIFT’s infrastructure, describing it as slow, costly, and prone to human error. “SWIFT has a reported error rate of 6%,” he noted, citing insights from a Fortune 50 CFO who observed an even higher 11% failure rate in their company’s cross-border transactions. These failures often demand manual intervention, leading to delays and unnecessary costs.
However, Garlinghouse pointed to an even deeper flaw in the traditional system with trapped liquidity. According to him, estimates from major consulting firms suggest as much as $10 trillion is currently locked in nostro accounts worldwide just to support the existing correspondent banking model. Ripple, through XRP and its On-Demand Liquidity (ODL) solution, aims to unlock this capital.
However, Ripple isn’t the only player progressing, as SWIFT also seems to be stepping up. In response to blockchain challengers like Ripple, SWIFT has teamed up with Chainlink to improve its infrastructure.
SWIFT’s partnership with Chainlink is looking to take advantage of Chainlink’s Cross-Chain Interoperability Protocol (CCIP) for transfers of tokenized assets across multiple blockchains.
