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Swift is a communication protocol to move digital cash. Once the wire goes through, the next bank has the cash and the last bank doesn't. That solves the clea
by psychlops 6y ago
Swift is a communication protocol to move digital cash. Once the wire goes through, the next bank has the cash and the last bank doesn't. That solves the clearing problem (for currencies). Yes, the process is sticky as every bank likes to hold the money as long as possible, but ownership is clear and fast.
The clearing problem for OP is with stocks and deal with purchasing and selling from different owners using a regulatory intermediary (DTCC). Getting all those parts coordinated is more challenging.
- satellite2 6y agoEverything is inverted from the bank perspective. When they receive "cash" they actually receive an obligation to pay one of their client against some other debt, which might not be an enviable position. There is no such thing as digital cash actually. You have cash, the real and physical and all the rest is balance sheet expansion, i.e. debt. If you are interested in banking I would encourage you to watch this course from the Columbia university: https://www.coursera.org/learn/money-banking https://www.coursera.org/learn/money-banking which is the reference and is fascinating.