Fiat currency settlement refers to the final transfer of traditional government-issued money, like USD or EUR, to complete a transaction. In the context of digital assets, this means converting cryptocurrency holdings back into fiat currency and depositing it into a conventional bank account. It represents the conclusion of a financial operation using established banking systems. This process bridges the gap between digital asset markets and traditional financial infrastructure.
Context
Discussions around fiat currency settlement often concern regulatory compliance, speed, and cost efficiency in cryptocurrency exchanges and payment systems. News frequently covers developments in payment rails and banking partnerships that facilitate smoother fiat conversions. The availability and ease of fiat settlement are crucial for broader adoption of digital assets by individuals and businesses.
Leveraging DLT on a universal ledger enables regulated financial institutions to achieve near-real-time, 24/7 settlement, optimizing capital velocity and reducing counterparty risk.
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