SWIFT ban in Russia
Europe banned several Russian banks from the SWIFT payment system after the country started a military invasion of Ukraine in February 2022. This messaging network covers over 200 countries and includes an estimated 11,500 financial institutions 鈥 with several hundreds of its users located in Russia. It gives each participant its own identification code 鈥 a BIC, or Business Identifier Code. The BIC of Commerzbank, for example, is COBADEFFXXX, identifying the bank as 鈥淐ommerzbank鈥 (COBA) from Germany (DE) in Frankfurt (FF) and it being the head office (XXX). This way, financial institutions communicate transactions to each other in a standardized way. Without SWIFT, cross-border financial traffic is more difficult. As SWIFT provides a payment transaction framework - rather than actively transferring payments itself - some compare SWIFT to the Ripple (XRP) blockchain. Long regarded as a 鈥渘uclear option鈥, so how will a ban of such a system this impact Russia moving forward?
