Citi and Swift have confirmed a major breakthrough for institutional digital assets: traditional fiat currencies and digital currencies can now be settled against each other using a unified Payment-versus-Payment (PvP) workflow. Announced on November 14, 2025, the experiment marks one of the clearest signs yet that global banks are preparing for large-scale digital settlement.
The trial showed that interoperability between existing banking rails and distributed-ledger networks can be achieved without replacing current infrastructure. Swift’s global messaging system acted as the connective tissue, linking fiat transactions with blockchain-based digital asset movements. Citi conducted the digital-currency leg using test USDC tokens on Ethereum’s Sepolia testnet, proving that tokenized assets can integrate smoothly with traditional payment systems.
To mitigate settlement risk, one of the biggest concerns in blockchain payments, the trial used an escrow mechanismand a central orchestrator to synchronize both sides of the transaction. This ensured that neither the fiat leg nor the digital-currency leg could settle unless both were successfully completed.
One of the most important outcomes was the creation of a new messaging standard designed specifically for fiat-to-digital-currency settlement. This messaging structure could become the foundation for institutional adoption, enabling banks, asset managers, and corporates to transact digital assets with the same confidence as traditional payments.
Citi and Swift say the next phase will focus on working with the broader financial community to develop shared standards for digital settlements, an essential step before digital currencies, tokenized deposits, and stablecoins can reach institutional scale.
By proving that fiat and digital currencies can settle safely on synchronized rails, the trial positions banks to play a central role in the coming era of tokenized finance.
