Distributed Ledger Technology (DLT) is an umbrella term used to describe technologies which distribute records or information among all those using it, either privately or publicly. Below are some primary characteristic of DLT.
Disintermediate: In a peer-to-peer model, every peer in the network is a server and client, thus eliminating the middlemen in processes between users. Enables the facilitation of transactions without a central, privileged third party even in the absence of trust.
Secure by Cryptography: Public key cryptography is a method for verifying digital identity with a high degree of confidence, enabled by the use of private and public keys. Allows for increased security and protection of data and identity in the system.
Smart Contracts and Oracles: Smart Contracts are virtual agreements encoded on the DLT that can be automatically reconciled based on logical conditions. Enables the secure automation of complex, logical agreements and the business processes using data gathered by Oracles.
Immutable: Data on the DLT is immutable, and is thus resistant to double-spending, fraud, censorship and hacking efforts. Creates a more secure, transparent network and creates new avenues for regulators.
Real-time settlement: DLT allows for near real-time settlement of transactions, removing friction and reducing risk. Enables transactions to be made in near real-time between users on the network.
Trustless: DLT is based on cryptographic proof, allowing any two parties to transact directly with each other without a trusted third party. Allows two or more trustless parties to transact directly with each other.