Distributed Ledger Technology (DLT) Definition
Distributed ledgers, unlike Centralized Ledgers, do not have a central data store and eliminate the need for a single authority, thereby preventing manipulation. It is a digital asset transaction recording system in which transactions and their information are recorded in several places at the same time. Distributed Ledger Technology is a protocol that allows a decentralized digital database to function securely.
Table of Contents
· Distributed Ledger Technology`s concept
· Distributed Ledger VS Centralized Ledger
· Distributed Ledger Technology`s samples
· What is the point of Distributed Ledger Technology?
· What are the differences between Distributed Ledger and Blockchain Technology?
· The future of Distributed Ledger Technology.
Centralized Ledger VS Distributed Ledger
Centralized Ledger
A centralized ledger includes all the accounts for recording transactions relating to a company like its assets, liabilities, owners’ equity, revenue, and expenses. Everything around the world that can possess financial value needs a ledger. In modern days computerized ledger came into existence i.e Enterprise resource planning (ERP). The centralized ledger works as a central repository for accounting data from all sub ledgers was migrated, including cash management, fixed assets, purchasing, and projects. The centralized ledger is the foundation of every accounting system, as it houses all of an organization’s financial and non-financial data. The collection of all accounts is known as the centralized ledger. This could be a massive book in a manual or non-computerized system. The centralized ledger has one or more pages for each account.
Distributed Ledger
In Distributed Ledger that is also known as shared ledger, there is no central administrator or data storage. A distributed ledger is essentially a database that can be shared across a network of multiple sites, across the world. All participants within a computer`s network can have their own identical copy of the ledger. Any changes to the ledger are reflected in all copies in a second. The assets can be financial, legal, physical or electronic. The security and accuracy of the assets stored in the ledger are kept encrypted. According to the network’s agreed-upon rules, entries can also be modified by one, several, or all of the participants. ‘Block Chain’ may appear in a number of articles. A simply sort of distributed ledger is a blockchain.
Distributed Ledger Technology`s samples
Telecommunication networks:
1. computer networks such as the Internet,
2. telephone networks and cellular networks,
3. wireless sensor networks,
4. routing algorithms;
Network applications:
1. network file systems,
2. distributed databases and distributed database management systems,
3. World Wide Web and peer-to-peer networks,
4. distributed cache such as burst buffers,
5. massively multiplayer online games and virtual reality communities,
6. distributed information processing systems such as banking systems and airline reservation systems;
Real-Time process control:
aircraft control systems,
industrial control systems;
Parallel computation:
1. Scientific computing, including cluster computing, grid computing, cloud computing, and various volunteer computing projects (see the list of distributed computing projects)
2. Distributed rendering in computer graphics.
What are the differences between Distributed Ledger and Blockchain Technology?
1. Distributed ledger has different types that blockchain is just one type of them
2. Although distributed ledgers do not require a chain, blockchain is a sequence of blocks.
3. Theoretically better scaling options such as proof of work are not necessarily needed for distributed ledgers.
4. On the contrary to blockchain, it is not essential for a distributed ledger to have a data structure in blocks.
5. A distributed ledger is merely a type of database spread across multiple sites, regions, or participants.
6. It appears that distributed ledger sounds exactly how you probably envision a blockchain. However, all blockchains are distributed ledgers, but remember that not all distributed ledgers are blockchains.
The future of Distributed Ledger Technology
According to, Deloitte’s 2021 Global blockchain development Survey, almost 76% of executives surveyed said they expect digital assets will be a solid alternative to fiat currencies for global finance in the next 5–10 years.
“It looks like blockchain is here to stay, I think it’s going to be a powerful technology for modern society.”
— Reid Hoffman, Co-Founder & Executive Chairman, LinkedIn.
There are some reasons for the claims that are briefly mentioned in the following;
- NFTs And Non-Fungible Tokens
- Faster Transactions
- Digital Identity
- Easier Voting
- It’ll Be Easier to Treat Health Problems
- Adoption of Cryptocurrency
- It Will Be Possible for You to Purchase a Car with No Money Down!
