Citi and Swift have completed a landmark trial that demonstrates how payments between fiat and digital currencies can be settled both safely and efficiently using a new hybrid Payment-versus-Payment (PvP) model. By integrating blockchain connectors, smart contracts, and advanced orchestration tools into Swift’s global infrastructure, the trial proved that traditional banking systems can interact seamlessly with Distributed Ledger Technology (DLT).
Blockchain-Enhanced Settlement for Real-World Use
The test leveraged Circle’s USDC tokens on the Ethereum Sepolia testnet to replicate real-world settlement scenarios. A key component of the trial was an escrow mechanism designed to mitigate the irreversible nature of blockchain transactions. This setup ensured secure, synchronized settlement for both fiat and digital assets—an essential requirement for institutional adoption.
Executives from both Citi and Swift stated that the trial confirms how blockchain can significantly improve cross-currency settlement. Benefits highlighted include faster processing, improved transparency, enhanced security, and a reduced risk profile for participants across global payment networks.
A Step Toward Scalable, Institutional-Grade Digital Asset Infrastructure
As stablecoin adoption accelerates worldwide, the success of this initiative marks an important milestone for the financial industry. The hybrid PvP model shows strong potential to enable scalable, institutional-grade digital asset solutions that align with the operational standards of major global banks.
Citi and Swift plan to continue refining the model in collaboration with industry partners. Their goal is to develop unified standards that support the increasing demand for efficient fiat-to-digital currency settlement across international financial networks. This progress signals a new era where blockchain technology enhances—not replaces—existing global payment systems.
