The following Financial Services guidance note provides comprehensive and up to date legal information covering:
A distributed ledger is a database that can securely record financial, physical or electronic assets for sharing across a network through entirely transparent updates of information. Its first incarnation was ‘blockchain’ in 2008. Blockchain, which has been known principally for the role it plays in enabling Bitcoin and other cryptocurrencies and crypto tokens such as Etherium, is a technology viewed by proponents as capable of revolutionising financial services. On one level, blockchain is a database for recording records of transactions or other information. On another, blockchain is a tool capable of powering a multitude of applications that could fundamentally change how financial services are currently provided.
It is difficult to come across a unified explanation of how one should look at the concept of distributed ledger technology (DLT) but in essence it can be described as a set of technological solutions that enables cryptographically secured records, or ledgers, of electronic transactions to be maintained by a shared or ‘distributed’ network of participants (so-called ‘nodes’) and not by a centralised entity, meaning that there is no central validation system. Moreover, enterprises use DLT to process, validate or authenticate transactions or other types of data exchanges. Records are stored in the ledger once consensus is achieved by the majority of parties. Every record stored in
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