DLT Capital Markets

Definition ∞ DLT capital markets refer to financial markets where the issuance, trading, and settlement of securities and other financial instruments occur on distributed ledger technology. This infrastructure aims to replace traditional, often siloed, systems with a shared, immutable ledger. The objective is to increase operational efficiency, reduce settlement times, lower costs, and enhance transparency across various financial transactions. It represents a fundamental shift in market architecture.
Context ∞ The development of DLT capital markets is a major theme in financial news, with central banks and large financial institutions actively investigating or implementing blockchain-based solutions for bonds, equities, and other assets. Discussions often revolve around regulatory clarity, the need for industry-wide standards, and the challenges of integrating new technology with legacy systems. The potential for real-time gross settlement and reduced counterparty risk positions DLT as a transformative force in global finance.