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. 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'. A conceptual framework is presented that divides a DLT system into three main layers–protocol, network, and data–which can be further subdivided into a set of components and processes. The report outlines various configuration options for each process and demonstrates how specific design choices can lead to different system properties and characteristics. A key takeaway is that trade-offs are inherent to DLT systems, and move along a spectrum according to specific security assumptions, threat models, and trust relationships. The framework is applied to six case studies of existing DLT systems–Bitcoin, Ethereum, Ripple, Alastria, Verified. me, and an anonymised DLT system–to illustrate its use for performing a comparative analysis. The …