Definition ∞ Wholesale settlement refers to the final transfer of assets or funds between financial institutions to discharge obligations. This process typically occurs in large denominations and involves high-value transactions between banks and other large financial entities. In the context of digital assets, wholesale settlement may involve the use of central bank digital currencies (CBDCs) or regulated stablecoins to facilitate rapid and efficient interbank payments. The objective is to finalize transactions securely and irrevocably.
Context ∞ The current dialogue concerning wholesale settlement often centers on the potential for distributed ledger technology (DLT) to revolutionize existing payment systems by enabling faster and more cost-effective cross-border transactions. Key debates involve the technical feasibility, regulatory compliance, and security implications of using digital assets for interbank clearing and settlement. Future developments to watch include the progress of central bank digital currency (CBDC) pilot programs and the establishment of regulated digital asset settlement infrastructures.
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