Definition ∞ Trust Minimized Settlement describes a process where the finalization of a transaction requires minimal reliance on intermediaries or third-party trust. In blockchain systems, this is achieved through cryptographic proofs and decentralized consensus mechanisms that verify transactions directly on the network. The goal is to reduce counterparty risk and eliminate the need for trust in external entities to ensure the integrity and finality of a transfer. It is a core principle of many decentralized protocols.
Context ∞ Trust minimized settlement is a central concept in crypto news, particularly when discussing the advantages of decentralized finance over traditional financial systems. The key discussion revolves around the security and efficiency of various blockchain architectures in achieving true settlement finality without external validation. Future developments will likely focus on enhancing the speed and scalability of these trust-minimized processes, making them more viable for high-volume financial operations.
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