blockchain compliant with ISO 20022

ISO 20022 is an ISO standard for electronic data exchange between financial institutions.

The standard covers financial information transferred between financial institutions, such as payment transactions, securities trading and settlement information, credit and debit card transactions and more.

Thanks to ISO 20022, a huge amount of metadata for financial services, stored in UML models with a special ISO 20022 UML profile, has been shared and standardized.

Among the organizations that use ISO 20022 is SWIFT, which is the world’s leading messaging network where international payments are made.

The standard was developed in 2013, or four years after Bitcoin was born, is issued by ISO Technical Committee 68 (TC68), and is administered by Working Group 4 (WG4), a subgroup of TC68.

Since 2015, when Ethereum was born, it has been widely adopted by EU countries, as well as Switzerland, the UK, India and Japan, Australia, Canada and New Zealand, as well as South Africa and Singapore.

The US Federal Reserve began to adopt it only in 2020, and the migration process is expected to end only this year. This means that now only China and Russia do not use it as a standard among major economies, in addition to South Korea and Brazil.

ISO 20022 blockchains

In light of all this, it is not at all surprising that older blockchains, such as Bitcoin, are not compatible with this standard, nor is it surprising that blockchains developed in Asia are not.

It is also not surprising that Ethereum is not compatible, because it is a project that was born when the ISO 20022 standard was still spreading. Also, it had not yet been widely adopted in the United States at the time.

The case of Ripple (XRP) is curious.

Ripple is actually a blockchain that was born in 2012, i.e. before the release of the ISO 20022 standard, and is a foundational American project. Nevertheless, it turns out to be among the few compatible blockchains.

The reason is that over time Ripple has specialized specifically in banking or institutional transactions, and therefore they wanted to integrate ISO 20022 compatibility over time to interact with the financial institutions that use it.

The other major blockchain project compatible with this standard is, unsurprisingly, Stellar (XLM), which is a project that grew out of a rib of Ripple when Jed McCaleb stepped down as CTO of Ripple in 2013, specifically to found Stellar in 2014.

However, Stellar is a completely different project from Ripple because it is not run by a single for-profit company, but is intended to be a truly decentralized protocol.

It is worth noting that compliance with ISO 20022 seems to have benefited only Ripple, which continues to be one of the top ten crypto projects in the world by market capitalization. In fact, XLM has now plummeted to 28th place in this particular ranking, surpassed even by outdated projects like Bitcoin Cash.

However, there are other blockchains that are compatible with this standard.

First, there is Algorand, with its ALGO cryptocurrency. Although this is a project that is often considered to be of a high standard, it has so far been far less successful than the alternatives. Suffice it to say that ALGO has fallen to 37th place by market value.

Interestingly, there are two other ISO 20022-compliant blockchains whose cryptocurrencies have very similar capitalization to ALGO: Hedera (HBAR) and Quant (QNT).

Taking XRP, which capitalizes at $22.5 billion, as a benchmark, XLM capitalizes only one-tenth ($2.4 billion), while HBAR (1.9), ALGO (1.6) and QNT (1.5 ) are all very close to just over half of XLM.

As far as is known, there are only two other ISO 20022-compliant blockchains left, namely IOTA (MIOTA) and XDC Network (XDC).

IOTA is a special case, because it was once among the most promising crypto projects, but then seems to have stopped completely due to major technical problems. Its cryptocurrency MIOTA has plunged to 78th by market capitalization with less than $600 million. It is enough to think that it capitalizes less than BitTorrent’s BTT, or BSV (Bitcoin SV), and its current value is lower than the value at launch in June 2017.

XDC capitalizes even less (550 million), but it has never been a particularly successful project. It is a project that was started just under five years ago, and until February 2021 it had never been much discussed.

So apart from XRP, which is a story in itself, none of the other blockchains compliant with the ISO 20022 standard have yet achieved much success. In fact, only Ripple among them has an effective ongoing relationship with traditional financial institutions.