Global Use of Distributed Ledger Technology in Cross Border Payments

Student: German Estrada, 2016-2017

Bitcoin is a successful proof of concept (POC) for a peer to peer (P2P) public electronic cash system, allowing the transfer of value over the Internet without an intermediary (banks). Behind the Bitcoin is the Blockchain or Distributed Ledger. This technology could revolutionize the traditional payment system in banking. The Internet has changed other industries before, and the Financial Industry could be next. The payment system today is centralized, which means that the ledger is controlled by a central party. Distributed Ledger technology enables the creation of a decentralized network in which the ledger is shared by all the members of the network. Among the possible implications are an increase in efficiency through a shorter time of transaction execution and absence of manual reconciliation, reduction in operating costs, enhancement of security through the use of cryptography, and improvements in client engagement by increasing trust because a fundamental principle of this technology is transparency.