"Distributed registry" is a concept that is increasingly glimpsed outside of the tech sector and is often equated with blockchain technology. The term has found use in bills, articles, regulatory publications, etc. In fact, blockchain is a special case of distributed ledgers, but DLT technology is not always blockchain. In this article, we'll take a detailed look at what DLT (distributed ledger technology) is.
- DLT TECHNOLOGY: WHAT IS IT?
DLT is a data storage technology, the main feature of which is sharing and synchronizing information according to a single consensus algorithm. In addition, such systems are characterized by the following features:
Distribution of data without geographical reference in equal copies.
The absence of a single central administrator.
The distributed registry is maintained by nodes or nodes.
All nodes must come to a consensus to validate the data.
The participants of the system are not united by any other agreement than the rules of the network.
- WHERE IS DLT TECHNOLOGY USED?
DLT is most widely used in cryptocurrencies, although technically basic distributed registries and digital currencies are completely different things. Cryptocurrencies are used solely to incentivize system participants to run nodes and keep the entire network running.
In addition, distributed registries are used to perform smart contracts and store various files in the Internet protocol.
- DLT VARIETIES
There are 3 varieties of DLTs depending on their availability:
Open. These are publicly available, open-source protocols. In this case, anyone can join the system or run their own node. Examples of such DLTs are BTC, ETH, DOGE, etc.
Federated. Such distributed registries are run by a limited group of people. Consensus is controlled by predefined nodes, Such DLTs are considered faster and more confidential. For example, B3i, Corda, and R3.
Private. Such distributed registries cannot be considered a full-fledged DLT, because full rights in the network have only centralized bodies.
Thus, DLT technology is quite diverse, which allows it to be used in a variety of activities. Of course, so far it is mostly spread in conjunction with cryptocurrencies, but in the future, its scope of coverage may significantly expand through the introduction of nationwide DLT networks.