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Distributed Ledger Technology in Payments, Clearing, and Settlement


  • Mills, David C.
  • Wang, Kathy
  • Malone, Brendan
  • Ravi, Anjana
  • Marquardt, Jeffrey C.
  • Chen, Clinton
  • Badev, Anton
  • Brezinski, Timothy
  • Fahy, Linda
  • Liao, Kimberley
  • Kargenian, Vanessa
  • Ellithorpe, Max
  • Ng, Wendy
  • Baird, Maria


Digital innovations in finance, loosely known as fintech, have garnered a great deal of attention across the financial industry. Distributed ledger technology (DLT) is one such innovation that has been cited as a means of transforming payment, clearing, and settlement (PCS) processes, including how funds are transferred and how securities, commodities, and derivatives are cleared and settled. DLT is a term that has been used by the industry in a variety of ways and so does not have a single definition. Because there is a wide spectrum of possible deployments of DLT, this paper will refer to the technology as some combination of components including peer-to-peer networking, distributed data storage, and cryptography that, among other things, can potentially change the way in which the storage, recordkeeping, and transfer of a digital asset is done.

Suggested Citation

  • Mills, David C. & Wang, Kathy & Malone, Brendan & Ravi, Anjana & Marquardt, Jeffrey C. & Chen, Clinton & Badev, Anton & Brezinski, Timothy & Fahy, Linda & Liao, Kimberley & Kargenian, Vanessa & Ellith, 2016. "Distributed Ledger Technology in Payments, Clearing, and Settlement," Finance and Economics Discussion Series 2016-095, Board of Governors of the Federal Reserve System (U.S.).
  • Handle: RePEc:fip:fedgfe:2016-95
    DOI: 10.17016/FEDS.2016.095

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    Blog mentions

    As found by, the blog aggregator for Economics research:
    1. What Bitcoin Has Become
      by Steve Cecchetti and Kim Schoenholtz in Money, Banking and Financial Markets on 2017-01-23 19:00:14


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    Cited by:

    1. repec:elg:eechap:17331_2 is not listed on IDEAS
    2. Meyer Aaron & Francisco Rivadeneyra & Samantha Sohal, 2017. "Fintech: Is This Time Different? A Framework for Assessing Risks and Opportunities for Central Banks," Discussion Papers 17-10, Bank of Canada.
    3. repec:nzb:nzbbul:may2018:5 is not listed on IDEAS
    4. Benos, Evangelos & Garratt, Rodney & Gurrola-Perez, Pedro, 2017. "The economics of distributed ledger technology for securities settlement," Bank of England working papers 670, Bank of England.
    5. repec:scn:financ:y:2017:i:2:p:94-99 is not listed on IDEAS
    6. Gerald P. Dwyer, 2017. "Blockchain: a primer," Chapters,in: The Most Important Concepts in Finance, chapter 2, pages 12-27 Edward Elgar Publishing.

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