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- SWIFT is a messaging system, not a real-time payment rail.
- Ripple’s XRP enables near-instant, cost-efficient cross-border payments.
- XRP is more likely to augment SWIFT than replace it overnight.
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The debate over SWIFT and Ripple’s XRP often sparks hype, but a technical breakdown by Vincent Van Code provides a grounded perspective. His analysis highlights how traditional banking inefficiencies persist and how XRP-powered solutions could modernize cross-border payments over time.
How SWIFT Actually Works: Messaging, Not Money
SWIFT, used by over 11,000 financial institutions worldwide, is a secure messaging system for transmitting payment instructions—not a payment network itself. Real settlement occurs through chains of correspondent banks, using nostro and vostro accounts to transfer actual funds.
With all the noise lately around SWIFT vs XRP (which is such a dumb comparison), I will weigh in on what SWIFT really is, and I will comment on how Ripple will (eventually replace or augment it). And yes nothing Bout XRP, mooning or switch flipping…. But if you are after some…
— Vincent Van Code (@vincent_vancode) September 5, 2025
Even with SWIFT GPI, which has accelerated some flows, cross-border payments often take 48–72 hours. Each transaction involves multiple intermediaries, compliance checks, FX conversions, and batch processing, exposing banks and customers to delays and higher costs.
Ripple’s On-Demand Liquidity: Fast, Efficient, Transparent
Ripple’s On-Demand Liquidity (ODL) addresses these inefficiencies by leveraging XRP as a bridge asset. Instead of pre-funding foreign accounts, a sending institution converts local currency into XRP, which settles across the ledger in 3–5 seconds. The receiving bank then converts XRP into the target currency, achieving near-instant settlement while reducing intermediaries and dormant capital needs.
This process offers cost savings, faster execution, and enhanced transparency in payment corridors where liquidity and compliance frameworks are robust.
Adoption Challenges and Gradual Integration
Despite clear benefits, XRP adoption faces hurdles. Liquidity across certain currency pairs is uneven, and banks must navigate AML, KYC, and regulatory compliance. Conservative institutions are hesitant to replace long-standing correspondent banking relationships. Ripple’s current operational success is mostly corridor-specific, making broad adoption a gradual process.
Vincent Van Code emphasizes that XRP is unlikely to replace SWIFT overnight. Instead, Ripple is poised to augment global payments, optimizing corridors with favorable liquidity and regulatory frameworks. Over time, proven cost efficiency and compliance alignment could position XRP as a central settlement tool.
Also Read: XRP Code Reveals Direct ISO 20022 & SWIFT Integration — Proof Ripple Is Bank-Ready
Beyond remittances, XRP could play a role in tokenized assets and central bank digital currencies (CBDCs). Ripple’s solutions could enhance interoperability between fragmented systems—a challenge SWIFT has struggled to address.
Transforming international payments is a long-term endeavor. Ripple offers speed, transparency, and cost savings, but widespread adoption depends on regulatory alignment, corridor liquidity, and sustained operational success. The evolution from SWIFT to XRP-powered solutions is not immediate but promises a more modern, efficient global payments ecosystem.
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Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses
I’m your translator between the financial Old World and the new frontier of crypto. After a career demystifying economics and markets, I enjoy elucidating crypto – from investment risks to earth-shaking potential. Let’s explore!
