Citi & Swift Achieve Breakthrough in Fiat-to-Digital Currency Settlement

Citi and Swift completed a trial enabling synchronized fiat-to-digital currency settlements using USDC on Ethereum, demonstrating interoperability and paving the way for efficient, risk-mitigated cross-border payments.

Citi and Swift have completed a landmark trial demonstrating Payment-versus-Payment (PvP) settlement between fiat and digital currencies, using USDC tokens on the Ethereum Sepolia testnet. The initiative enhanced Swift’s infrastructure with blockchain connectors, orchestration tools, and smart contracts, enabling synchronized settlement and reducing risks for both parties. The system included a messaging standard to track transactions end-to-end and an escrow mechanism to ensure finality. This trial validates the interoperability of traditional financial systems with distributed ledger networks, paving the way for efficient, risk-mitigated cross-border payments. The approach addresses challenges in converting stablecoins and tokenized deposits into local fiat currency, and signals growing institutional acceptance of stablecoins. Citi and Swift plan to further refine the workflow and develop standards for secure, scalable digital asset transactions, highlighting the increasing demand for stablecoins and cross-currency settlement solutions.