Developers Are Working on a Blockchain-Based SWIFT Substitute

Crypto and digital currencies

Aug 2, 2022

4 min. read

James Irwin

Author

Researchers at a major Russian university are developing a blockchain-based alternative to the cross-border banking network SWIFT.

As sanctions are imposed on Russia, alternatives to the global banking network SWIFT could gain popularity.

Domestic SWIFT Competitor Uses Blockchain

A project called Domestic SWIFT is currently under development at the Competence Center of the National Technology Initiative at St. Petersburg University in Russia.

According to a statement from researchers, the project consists of a “decentralized interbank financial messaging system.” Those researchers also say that a pilot version of the system is “ready for testing and can be used in banks.”

Though Domestic SWIFT does not use a traditional blockchain, its approach will offer similar benefits. Perhaps most importantly, because it relies on a distributed ledger and network, members cannot be restricted or forcibly disconnected, and they all have the same access rights.

The system also promises a high throughput rate. Test results show that Domestic SWIFT can handle 25,000 messages per second on a single node. Developers say that further scaling is possible.

Russia’s Tense Relationship With SWIFT

Domestic SWIFT is one of many SWIFT alternatives in the Russian market. The Bank of Russia has used a non-blockchain alternative called the System for Transfer of Financial Messages (SPFS) since 2014. SPFS is used by Russian banks and at least 52 foreign organizations.

Other competitors also appear to be under development. In June, a Russian state-owned technology developer called Novosibirsk Institute of Software Systems (NIPS) announced that it was developing a blockchain platform called CELLS to complement SWIFT.

Earlier this year, SWIFT blocked seven Russian banks from its network in opposition to Russia’s invasion of Ukraine. If such sanctions continue to be imposed, SWIFT alternatives could become indispensable in Russia.

SWIFT is one of the world’s largest bank messaging and settlement networks, handling about half of all cross-border transactions. Over 300 Russian banks use the service, meaning that banks excluded from the system will need to find a replacement if the war continues.

Though SWIFT is popular for bank transactions, it is not the only way to make cross-border payments. Payset offers numerous alternatives, including international IBANs, multi-currency accounts, payment cards, and foreign currency exchange.

A UK multi-currency account can streamline how you manage your finances. Whether for business or personal use, a multi-currency account provides you with added freedom and flexibility and removes barriers to payments and transfer methods.

Here is everything you need to know about UK multi-currency accounts.

A Payset UK multi-currency account is a single account with which you can hold, send, and receive funds in up to 38 currencies. This allows business or personal account holders to save endless time and money on foreign exchange, and money transfers, which from a traditional bank account would be far more expensive and slow.

From your personal UK-based IBAN account, you can transfer money to bank accounts around the world as well as send and receive free and instant transfers to and from other Payset clients. You can send funds using a diverse network of payment networks, including SWIFT, SEPA, Target2, Faster Payments, CHAPS, and more.

When you exchange funds from one currency to another, there are no margins added to our exchange rates and the fees are clearly displayed before you click send. If you, for example, work with multiple currencies, make purchases in other countries, travel frequently, invest in foreign currencies, pay staff in other countries, or receive payments in other currencies, a multi-currency account can save you time, money, and work compared to a traditional bank account.

There are lots of banking institutions and financial services that will aid you in opening a multi-currency account. Often they can allow you to convert and transfer a considerable number of currencies.

Before you open a UK multi-currency account with any platform or service, make sure you have explored all of the different options available to you and have found the best type of account to suit your financial needs.

How Does a UK Multi-Currency Account Work?

A UK multi-currency account works in the same way as a standard bank account or electronic wallet. Although the services provided will change depending on where you choose to open your account and who you choose to open the account with, all multi-currency accounts should allow you to:

Withdraw money

Send and receive payments in multiple currencies internationally

Access your funds for electronic transfers

Earn interest on your account total

In the same way that fees can occur with a standard bank account you may run into additional charges with a UK multi-currency account.

You could be charged for a number of actions including; making withdrawals, account opening and closure fees, transfer fees, and more.

The frequency or amount of these charges will often vary and if you ask your banking agency they will usually be able to tell you exactly how much you will be charged and which services you will be charged for before you open your account.

Alternative Options to Consider Before Opening a UK Multi-Currency Account

There are many alternatives to opening a UK multi-currency account. For example, there are also money transfer services and online electronic wallets such as Payset that allow you to send your money in over 34 currencies without the need for a UK multi-currency account. You can start sending money across the globe or in person today using your existing bank account.

Frequently asked questions

What is a UK multi-currency account/IBAN?

Are there limits to the amount of money I can send and receive with a UK multi currency account?

Which currencies can I send and receive in my UK multi currency account?

How do I add money to my UK multi currency account?

Types of UK Multi-Currency Accounts

Multi-currency IBAN accounts
Personal multi-currency accounts
Multi-currency accounts for business
Multi-currency cash passports
Multi-currency wallets

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