Financial institutions and systems worldwide are working to simplify data exchange, making international transfers faster, more organized, and cost-effective. Cryptocurrency platforms face similar challenges, especially in achieving blockchain compatibility. A key solution is the adoption of the ISO 20022 standard, which provides a unified messaging method for financial institutions. This standard streamlines communication, enhances security, and ensures reliability both within platforms and across third-party systems. In this article, we'll explore the potential benefits of adopting ISO 20022 for crypto projects and look at some ISO 20022 coins.
What is ISO 20022?
ISO 20022 is an International Organization for Standardization (ISO) standard for exchanging electronic messages about payment data between banks. The goal of ISO 20022 is to combine all existing message formats into one language—eXtensible Markup Language (XML)—thereby simplifying data processing.
The standard defines approaches to building business models, the rules for describing business processes, the procedure for designing schemes and message formats and their descriptions, and also regulates the processes of publishing documentation according to the standard and the basic rules for its maintenance. The first edition of the protocol was released in 2008.
SWIFT is the competent authority for the registration and maintenance of ISO 20022.
The transition from traditional SWIFT massaging to ISO 20022 will have a direct impact on the crypto industry. In particular, coins that meet the standard can be more quickly accepted into the traditional financial system. If it happens that such large projects as Bitcoin or ETH adopt ISO standards and are integrated into the SWIFT system, this could radically change the way cryptocurrency and fiat currency ecosystems coexist.
To date, 8 crypto coins already meet the ISO 20022 standard: XRP (XRP), Stellar Lumens (XLM), XDC Network (XDC), Algorand (ALGO), and Iota (IOTA), Hedera Hashgraph (HBB AR), Quant (QNT) and Cardano (ADA). Two of them do not just comply with ISO 20022, they are members of the ISO 20022 standardization body. These currencies are XRP and Stellar Lumens.
List of ISO 20022 compliant cryptocurrencies in 2024
XRP (XRP)
XRP (XRP), the main cryptocurrency of Ripple, is also one of the largest market cap crypto and is by far the largest compliant ISO 20022 coin.
Ripple is a member of the ISO 20022 standardization body and the second largest fintech company in the United States. The XRP coin is considered to mediate between the crypto and fiat markets and is used for various purposes, including fast and cheap cross-border operations. Today XRP can process about 1,500 transactions per second.
Stellar (XLM)
Stellar appeared after the Ripple hard fork and then became a separate network. As well as its "progenitor", Stellar is a member of the ISO 20022 standardization body. XLM coin, like XRP, is designed to combine the crypto and fiat worlds but focuses on currency conversion for individuals rather than organizations other than XRP. It is also designed to develop central bank digital currencies (CBDC).
Currently, more than 300 financial institutions in 45 countries use XLM as a settlement mechanism, including Santander Bank and Canadian Imperial Bank of Commerce.
Cardano (ADA)
Cardano is a decentralized Proof-of-Stake (PoS) blockchain with an Outdoor algorithm that provides proven security and increased transaction processing speed. It is now the world's largest public PoS blockchain with a strong community that has gained a significant presence in the cryptocurrency market, reflecting its widespread acceptance and interest among investors.
Quant (QNT)
Quant is designed to simplify the interaction between major blockchains such as Bitcoin, Ethereum, and Ripple using its gateway, the Overledger DLT operating system. When using it, the issue of compatibility of various blockchains within one ecosystem is solved.
The Quant network enables the creation of advanced multi-chain applications that take advantage of the unique advantages of different blockchains while maintaining the maximum security and integrity of each blockchain.
QNT is Quant Protocol's own currency and is paid by developers to create and operate dApps on the network.
Algorand (ALGO)
Algorand is a large Level 1 blockchain trying to solve many of the problems inherent with competitors like Ethereum. As it said, it is capable of processing about 1,300 transactions per second. The Pure Proof-of-Stake consensus method facilitates rapid transaction confirmation but also maintains one of the lowest transaction fees in the cryptocurrency world while maintaining environmental awareness.
Hedera HashGraph (HBAR)
This distributed ledger platform is similar to blockchain but has a slightly different mechanism of operation. The Hedera Hashgraph project is designed to overcome many of the limitations of traditional blockchains and can execute 10,000 transactions per second (with some reports up to 500,000 transactions per second) with a high level of security. Unlike competitors, Hedera Hashgraph uses a function called a directed acyclic graph to sequence transactions without dividing them into blocks. HBAR is its own cryptocurrency.
IOTA (MIOTA)
A centralized blockchain registry designed to process Internet of Things (IoT)-based transactions. The uniqueness of IOTA lies in the absence of a standard blockchain from the blockchain in favor of a special acyclic graph called Tangle. This allows any user of the system to be a conditional "miner." Everyone who wants to make a transaction is obliged to take part in the formation of the network and approve the two previous transactions. The processing of the other two operations ensures that consensus is reached on the status of the transactions.
Tangle technology also provides superior scalability compared to many other blockchain-based cryptocurrencies. It also excludes limits on transaction volumes (a capability of many micropayments) and their number.
XDC Network (XDC)
XDC Network is an open-source hybrid blockchain protocol that specializes in tokenization for decentralized finance (DeFi). The network is used as a tool for long-term decentralized management. The most striking and important feature of the network is that it embodies a completely new XDPoS consensus mechanism. Compared to Delegated Proof-of-Stake (DPoS), it is much more energy efficient and faster.
XDC complies with ISO 20022. According to its website, the network "allows enterprises of any type to connect their legacy systems to a network of blockchain using the XDC protocol and ISO 20022 compliant messaging."
Xinfin has partnered with R3, a consortium of more than 200 financial institutions, to act as a bridge and host dApps on the Corda Marketplace. Corda "is compatible with existing and emerging regulations such as ISO 20022."
Conclusion
In conclusion, we will determine the main advantages of ISO 20022 coins:
- Solution of the compatibility issue through compliance with a single coding standard.
- Increase the speed of various transactions: domestic payments, cross-border payments, large payments, ACH and real-time payments.
- Increase of accuracy and safety of data transfer process through its automation.
- The adoption of ISO 20022 coins will simplify their cooperation with the global banking system. It is then likely that these cryptocurrencies will also be used by partner commercial banks.
It is still difficult to predict what impact the adoption of standardization by cryptocurrencies will have on the crypto world as a whole. However, this will undoubtedly lead to increased interest of financial institutions and investors in such currencies.
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