DLT Payment Systems are payment infrastructures built upon Distributed Ledger Technology, such as blockchain. These systems enable the recording and settlement of transactions across a decentralized network of computers. They offer potential benefits such as increased transaction speed, reduced costs, enhanced transparency, and improved resilience compared to traditional payment networks. Such systems facilitate direct peer-to-peer value transfer.
Context
The discussion around DLT payment systems often centers on their potential to revolutionize cross-border payments and wholesale settlement processes. Key debates involve regulatory oversight, interoperability with existing financial systems, and scalability challenges inherent in some DLT designs. A critical future development involves the widespread adoption of central bank digital currencies and tokenized commercial bank money within these systems. News frequently covers pilot programs and international collaborations exploring these new payment rails.
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