Swiss Banks Achieve Near-Real-Time Fiat Settlement Using Google Cloud DLT ∞ Adoption

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Briefing

Swiss-regulated financial institutions, led by AMINA Bank and Crypto Finance Group, successfully completed a pilot program utilizing Distributed Ledger Technology (DLT) on the Google Cloud Universal Ledger (GCUL) platform to modernize interbank settlement. This adoption fundamentally alters the operational model of wholesale payments by enabling near-real-time, 24/7 transaction finality within the existing regulatory framework. The initiative’s primary consequence is the immediate release of liquidity and a significant reduction in operational overhead for participating banks, quantified by the achievement of near-real-time, 24/7 settlement of Swiss Franc transactions using existing commercial bank money.

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Context

The traditional interbank settlement process is characterized by significant operational friction, primarily due to the sequential, batch-processed nature of clearing and settlement systems. This results in multi-day transaction finality, which fragments liquidity and introduces substantial counterparty risk, particularly in cross-border corridors. Furthermore, the reliance on multiple intermediary ledgers necessitates costly, time-consuming reconciliation processes, contributing to high Total Cost of Ownership (TCO) for financial market infrastructure. The prevailing challenge was the inability to achieve simultaneous exchange of value (Delivery versus Payment) for commercial bank money outside of standard business hours, constraining capital velocity and market access.

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Analysis

This adoption directly alters the interbank payment and settlement layer by replacing disparate, siloed ledgers with a single, shared source of truth powered by DLT. The Google Cloud Universal Ledger functions as a permissioned, trusted environment where commercial bank money can be atomically settled. The chain of cause and effect is systemic ∞ the DLT infrastructure ensures that the transfer of funds and the record of ownership are finalized simultaneously (atomic settlement), eliminating the settlement lag (T+N) and the associated counterparty risk.

For the enterprise, this integration into core banking systems allows for the continuous, 24/7 management of treasury and working capital, transforming liquidity from a static, fragmented resource into a dynamic, real-time utility. The Currency Operator role ensures compliance and rule-set governance, establishing a robust, scalable blueprint for other regulated financial consortiums seeking to modernize without disrupting their existing regulatory posture.

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Parameters

Core Adoption Entity ∞ AMINA Bank, Crypto Finance Group, and Banking Partners
DLT Platform ∞ Google Cloud Universal Ledger (GCUL)
Asset Type Settled ∞ Existing Commercial Bank Money (Swiss Francs)
Operational Improvement Metric ∞ Near-Real-Time, 24/7 Settlement
Integration Use Case ∞ Interbank Payment and Wholesale Settlement

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Outlook

The successful pilot establishes a critical precedent ∞ DLT can be integrated into existing financial infrastructure to achieve superior operational performance while maintaining regulatory compliance. The next phase involves scaling the platform to include a wider consortium of financial institutions and extending the use case to cross-border, multi-currency transactions. This model provides a competitive advantage by enabling the creation of new, high-velocity financial products and sets a new industry standard for the modernization of wholesale payment rails. Competitors will be compelled to pursue similar DLT-based settlement models to match the capital efficiency and risk reduction now demonstrated as feasible within a regulated environment.

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Verdict

This DLT-based settlement pilot is a definitive proof point, confirming that traditional finance can achieve atomic, 24/7 finality by integrating shared ledger technology into its core architecture.

Signal Acquired from ∞ fintechnews.ch