DLT
Distributed Ledger Technology
Technology enabling secure data sharing across multiple parties without requiring a central authority.
DLT encompasses various distributed database technologies including blockchain, directed acyclic graphs, and other consensus mechanisms for maintaining synchronized records across multiple participants. Financial applications include post-trade settlement, cross-border payments, Know Your Customer (KYC) data sharing, and regulatory reporting. DLT can improve transparency, reduce reconciliation costs, and enable real-time settlement while maintaining data integrity and auditability. Different consensus mechanisms suit various use cases from proof-of-work for public networks to practical Byzantine fault tolerance for private networks. Regulatory frameworks are developing to address DLT adoption while ensuring consumer protection and financial stability. Implementation requires careful consideration of governance, interoperability, and scalability requirements.
Example
Interbank settlement networks, consortium KYC platforms, supply chain finance