Two major traditional payment infrastructure initiatives moved closer to blockchain-linked cross-border and tokenized deposit capabilities this week. On Sept. 23, Federal Reserve Financial Services said FedNow participants will be able to combine domestic settlement with correspondent-banking arrangements for the international portion of a payment. On Sept. 24, IBM announced that its Digital Asset Haven platform can access Swift’s blockchain-based shared ledger through a beta ISO 20022 Messaging Adapter.
FedNow’s cross-border model remains deliberately domestic for settlement. FedNow settles the U.S. leg between participating domestic institutions, while banks or other approved intermediaries continue handling the overseas leg through the cross-border arrangements selected by each participant. The Federal Reserve has been preparing the legal structure since April, when the Board proposed amendments to Regulation J allowing FedNow participants to use intermediaries other than Federal Reserve Banks. The public comment period closed June 9, but the Board has not posted a final rule as of Sept. 24. Full rollout remains contingent on approval of Regulation J changes and corresponding updates to Operating Circular 8.
Early adopters will test enhanced ISO 20022 messages designed to carry information needed when a payment involves a sender or recipient outside the U.S. Payall Payment Systems is one of the named participants. President and CEO Gary Palmer said the integration is intended to provide faster and more transparent processing for the U.S. portion of international payments while digitizing compliance and transaction-risk checks. FedNow's domestic volume has risen sharply: it settled 4.997 million payments worth $274.66 billion in Q2 2026, up 83.2% by transaction count from Q1. For all of 2025, FedNow processed 8.41 million payments worth $853.4 billion, and the network now spans more than 1,500 participating financial institutions.
IBM’s new adapter lets regulated institutions use familiar ISO 20022 messages to instruct tokenized deposit transactions instead of creating separate blockchain-specific payment workflows. The company also opened an on-premises beta for IBM Z and LinuxONE systems, keeping digital asset operations and key-management infrastructure inside client data centers. IBM said the deployment supports stablecoins, tokenized deposits, hardware security modules, confidential computing and cold-storage processes such as structured key ceremonies.
Swift’s ledger uses an Ethereum Virtual Machine-compatible architecture based on Hyperledger Besu. It separates payment execution from final settlement, with banks retaining control of their assets, funding and keys. Seventeen banks from six continents are preparing live tokenized deposit transactions, including BNP Paribas, Citi, HSBC, Standard Chartered, UBS and Wells Fargo. HSBC and Standard Chartered completed a live interbank transaction through the ledger in August, with final settlement remaining on existing banking rails. IBM general manager Tom McPherson said financial institutions increasingly need traditional and tokenized assets to operate alongside one another. J.P. Morgan Payments separately reported that 93% of financial institutions are modernizing their payments infrastructure.
Regulatory feedback has highlighted unresolved compliance issues. The American Bankers Association asked for clarity on sanctions, anti-money laundering and fraud checks when FedNow forms part of a cross-border chain, while Stripe argued that existing operating rules contain a residency restriction that would need changes for the proposal to achieve its full purpose.
