Do $10 Trillion of Financial Deals Circulation Over Submarine Cables Every Day?

It’s frequently pointed out in journalism that $10 trillion of monetary deals circulation over submarine cable televisions every day. However is it real?

To appropriately tackle this claim, we require to check 2 things.

1. Do banks normally utilize submarine cable televisions for deals?

The brief response is yes. Regrettably, I can’t get too particular here due to the fact that a great deal of TeleGeography’s information on this subject is based upon personal interviews with banks and banks.

However believe me on this, the majority of banks are utilizing submarine cable televisions much like everybody else.

2. Exist $10 trillion each day worldwide in monetary deals?

Here’s the harder part: determining the volume each day in global monetary deals.

Let’s take a look at SWIFT deals as an example. SWIFT is the global network on which cross-border payments are started; the real payments themselves are performed on totally different networks.

In 2004, SWIFT pointed out 10 million messages a day and the typical worth per message had to do with $500k. This came out to about $5 trillion a day.

A couple of months back, SWIFT pointed out practically 45 million messages a day, a 4.5 x boost. So if the worth per message remained the very same, that indicates $22.4 trillion a day.

Even if the typical deal worth on SWIFT has actually fallen, the mix of SWIFT plus other monetary networks’ everyday volumes would put us over the $10 trillion mark.

So I believe we can proceed and securely call this misconception real.

SubOptic Myth 1 When investigating this misconception, I wondered about just how much $10 trillion actually is. Here’s my effort to put it into viewpoint.

Alan Mauldin and I tackled this misconception and 5 others throughout our discussion at SubOptic 2023.
Download our slides for the complete breakdown.

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