- UBS and Mizuho recently completed tokenized deposit transactions in Swiss francs and Japanese yen through the SWIFT ledger.
- The news comes amid rumors that UBS is moving its primary banking operations out of Switzerland.
UBS, a major Swiss multinational bank and financial services firm, and Mizuho, one of Japan’s megabanks, have recently completed a cross-border transaction using tokenized deposits. The institutions utilized SWIFT’s proprietary blockchain ledger for the task.
UBS and Mizuho’s Pilot Using Tokenized Deposits
According to Capital Pioneer, UBS and Mizuho conducted the trial through a sandbox. Using the SWIFT ledger, the Swiss and Japanese institutions exchanged payments in their respective fiat currencies: Swiss francs and Japanese yen.
The experiment allowed the parties to confirm workflow steps for on-chain settlement, financial messaging formats, and technical specifications for the platform processing the transfers. Mizuho highlighted that the test is the first phase of broader efforts to advance payment infrastructure through blockchain technology. It also confirmed that its pilot is part of ongoing tokenized pilots in Japan.
Additionally, the Japanese firm expressed interest in expanding its work on the SWIFT ledger. It’s currently studying more use cases for the technology beyond cross-border payments.
Why It Matters
UBS and Mizuho’s milestone breaks one of the key barriers preventing tokenized deposits from scaling into broader institutional adoption: interoperability. Over the past couple of years, banks have embarked on their own tokenized deposit projects. However, they have struggled to link them to enable value transfer across different banks, blockchains, jurisdictions, and existing payment and settlement rails.
SWIFT’s ledger offers an upgrade to an all-too-familiar, tested-and-proven system that connects more than 12,500 financial institutions, banks, and corporate organizations across 200 countries and territories. Instead of forcing legacy institutions to overhaul their systems from the ground up, the infrastructure builds on top of existing systems to create an orchestration layer for bank-issued tokenized assets.
UBS Relocating from Switzerland
Various reports suggest that UBS plans to move its key operations from Switzerland following the Swiss parliament’s decision to advance the Capital Adequacy Ordinance (CAO). The bill would impose higher capital requirements on the bank.
Swiss Finance Minister Karin Keller-Sutter downplayed the story, claiming that her department has agreed to grant UBS “significant concessions under the Capital Adequacy Ordinance.” Nonetheless, the rumor mill says the Swiss institution is considering a merger with major banks to move its business elsewhere.
The big names that have popped up in the stories were Morgan Stanley, Deutsche Bank, and Standard Chartered. So far, none of these have been officially confirmed.
