If they're building a replacement, doesn't that also mean we should use "cut off SWIFT" now, rather than later when it'll be ineffective?
The replacement is already functional.
In fact, Russia is not the only one having built a replacement to protect against the risk that SWIFT would be sanctioned: Europe has done it too with Instex: https://instex-europe.com/about-us/
SWIFT is a private company; those sanctions make it less competitive, and it is hard to play whack-a-mole with a worldwide market.
SWIFT, to be fair, is very convenient because of its standards and high connectivity. But if SWIFT was sanctioned today, banks can use literally any mechanism to route funds, from SPFS to email. What matters is the recursive existence of accounts held at banks that have accounts held at banks.
SWIFT is mostly about international settlement.
> You then get fragmentation and SWIFT losing some of its "soft power".
This already lost any power it had in 2014, because the threat of disconnection was wasted.
An honestly, EU lost its face now to talk "soft power." Every foreign head of state going to meet EU bureaucrats will now look at them, and think "can I rely on these people who threw out every treaty for a want of sleeping without a blanket?"
> can I rely on these people who threw out every treaty for a want of sleeping without a blanket?
Why isn't the US sending troops? Because the risk of escalation and nukes are unacceptable. In case you forgot, Europe also has nuclear powers and the risk of escalation is higher if the EU as an organization openly acts on more then soft power.
And as far as i know, only the US and the UK are ignoring a treaty to offer security to Ukraine.
Again, I'm not satisfied with the response so far, but what exactly are you suggesting so that EU bureaucrats don't lose their credibility?
He can lob a nuke right now, but he knows he will lose against the US.
He will retreat to avoid an even bigger defeat.
Thugs I fought in my teenage years, even when they brought a knife to the fight, when they are afraid of getting KOed, and humiliated in front of their peers, they wrap up, and leave.
They don't want to get beaten up, risk humiliation, and potentially committing murder at the same time.
Similarly, US can give Russian state 2 choices, a defeat with orderly surrender, or end like Yugoslavia, but 10 times worse.
SWIFT sanctions are kind of blunt given that we're now living in a world where any major power can write some software. And in this case both China and India offer alternatives.