Distributed Ledger Technology Systems: A Conceptual Framework
The distributed ledger technology (DLT) ecosystem is currently plagued by the use of inconsistent definitions and lack of standardised terminology. This report sets out to provide a common terminology and framework designed to serve as a multi-dimensional tool for policymakers, industry participants, researchers and investors to gain a better understanding of the characteristics and inner workings of a DLT system, and the roles that various actors play in the system
Specifically, the report lists five key characteristics that a DLT system must be capable of ensuring:
- Shared recordkeeping.
- Multi-party consensus on a shared set of records.
- Independent validation by each participant.
- Evidence of non-consensual changes.
- Resistance to tampering.
The report also clarifies the forms of data within a DLT structure, by classifying the data as ‘transactions’, ‘logs’, ‘records’, ‘journals’ and ‘ledger’ – based on the extent the data has been processed by a DLT system’s network. The final outcome – the ‘ledger’ – is defined as a set of records ‘held in common by a substantial proportion of network participants’.