Swiss Banks Pioneer Cross-Bank Payments Using Public Blockchain

Three Swiss banks—UBS, PostFinance, and Sygnum Bank—have executed the first binding cross-bank payment using tokenized deposits on a public blockchain. This breakthrough, part of a feasibility study under the Swiss Bankers Association, signals traditional finance's accelerating embrace of decentralized infrastructure.

The system leverages blockchain to settle transactions between institutions, offering faster settlement, lower costs, and enhanced transparency compared to correspondent banking networks. Smart contracts could further automate compliance and reporting functions. "This is something really new," said Sygnum's Thomas Frei. "Our tokenized deposits can be used across different banks—something that didn't exist before."

Unlike single-bank solutions like JPM Coin, this framework enables true interoperability. Frei describes it as "a new FORM of payments on the blockchain, an alternative to stablecoins." The trial involved clients transferring deposit-backed tokens between institutions, demonstrating practical utility beyond theoretical use cases.