What’s All the Hype About DLT?

In Distributed Ledger Technology, or what is popularly called DLT, we are looking at a technology that could endow unique trust to a wide range of services. Ledgers have been critical to the world of commerce since ancient times, mostly used to record transactions in money and property. Since the late 20th century, ledgers came to be digitised, but they only reflected what existed on paper once.

With DLT, enhanced visibility will be enabled into these ledgers, which can revolutionise the relationship of citizens with the state, supply chains, financial markets, public registers, and even B2C and B2B operations.

What is Distributed Ledger Technology (DLT)?

DLT is basically a database that can be shared across multiple sites, locations and institutions. All the transactions and their details in the ledger are recorded by multiple sites, at the same time. Therefore, all participants of a network have access to the ledger, where they get real-time updates regarding changes in the records.

Computers on the network are called “nodes.” Each node is responsible for the process, verifying every transaction that takes place, before generating a record of it. This creates consensus regarding the veracity of each transaction and its record. This is a significant change in the way records are stored and communicated. Security of assets stored in these transactions can be enhanced through the use of cryptography, using “keys” and digital signatures to access records.

DLT is Beyond Blockchain

The words “blockchain” and “distributed ledger technology” are not interchangeable, although they are often used interchangeably. A database of records that isn’t vulnerable to the single point of failure might sound like blockchain, but it isn’t.

A blockchain is essentially a type of DLT, with highly specific underlying technology. In a DLT, the implementer has greater control over the structure, functioning, and purpose of the network. It isn’t important that a DLT will always lead to a chain of “blocks.” Instead, cryptographic signing and linking groups of records come into play here. Blockchain is certainly the best-known type of DLT, but it isn’t the only one.

Why IronX Chose DLT

The IronX exchange aims to create a unique ecosystem based on DLT licenses. For starters, the absence of a central authority to verify transactions gives the network higher speed and scalability. This also means reduced cost of transactions. A network of nodes to verify each transaction means that there is no single point of failure, a system that cannot be easily manipulated or attacked.

Another key benefit is greater transparency in handling records. Today, DLT is widely being considered not only financial structures but corporate governance, voting procedures, tax collection, property registration, healthcare record-keeping, social benefits distribution, and even identity management.

DLT Regulatory Framework is Gradually Evolving

Many countries are taking the necessary steps to create a regulatory framework for DLT. On May 11, 2017, members of the European Parliament met to discuss the need for regulations in this space. Malta is one country that has made significant progress in this regard. On July 4, 2018, the Malta Digital Innovation Authority Act was passed, in order to promote innovation and consistent vision and principles in this space.

IronX has already applied for such licenses in jurisdictions like Malta and Gibraltar and has obtained licensing from the Estonian Financial Intelligence Unit. Operating under these licenses will guarantee users a stable, safe and systematic platform.