US Federal Reserve Releases First Distributed Ledger Research Paper - Mention to ILP

[RafOlP]

From the fed's paper: https://www.scribd.com/document/333308566/Distributed-ledger-technology-in-payments-clearing-and-settlement#from_embed?content=10079&ad_group=Online+Tracking+Link&campaign=Skimbit%2C+Ltd.&keyword=ft500noi&source=impactradius&medium=affiliate&irgwc=1

Quote

In addition, a particular industry development of note is the Interledger Protocol (ILP) which allowstransactions to flow across different ledgers and creates connection points between two or more digitalledgers. In effect, the protocol defines a set of procedures for proposing a payments path andcryptographically escrowing funds across a series of interoperable ledgers and then subsequentlyexecuting the escrowed transactions once the recipient of the payment validates or acknowledgesreceipt of payment. The ILP is being developed as an open standard and is intended to improveinteroperability and streamline the process for transferring digital assets by enabling entities in differentcountries with different payment systems to more easily transact with one another. Adoption of this ora similar protocol could spur further innovation and adoption of DLT-based systems for the cross-borderpayments use case.

Here is the coindesk coverage: http://www.coindesk.com/federal-reserve-central-bank-distributed-ledger-research-paper/

Looks like interledger is taking the place it deserves as an equalizer in the financial industry.

Edited December 5, 2016 by RafOlP

[RedDragon]

And with this amazing news Ripple XRP is still plummeting in price, meanwhile Mooncoin is up 51% today, I don't understand Crypto markets?

[tulo]

2 hours ago, RedDragon said:

And with this amazing news Ripple XRP is still plummeting in price, meanwhile Mooncoin is up 51% today, I don't understand Crypto markets?

It's easy...just speculation...making them quite unpredictable.

[MundoXRP]

The paper has many good sections. https://www.federalreserve.gov/econresdata/feds/2016/files/2016095pap.pdf

 "4 Potential opportunities for DLT in payments, clearing, and settlement"

Quote

Information collected through interviews with industry stakeholders indicates that firms have several common motivations behind efforts to develop and deploy DLT arrangements:

• Reduced complexity (especially in multiparty, cross-border transactions)

• Improved end-to-end processing speed and availability of assets and funds

• Decreased need for reconciliation across multiple recordkeeping infrastructures

• Increased transparency and immutability in transaction recordkeeping

• Improved network resiliency through distributed data management

• Reduced operational and financial risks

DLT is essentially asset-agnostic, meaning the technology is potentially capable of providing the storage, recordkeeping, and transfer of any type of asset. This asset-agnostic nature of DLT has resulted in a range of possible applications currently being explored for uses in post-trade processes.

4.2.2 Cross-border payments (ILP Quote from above)

4.2.3 Financial inclusion

Edited December 6, 2016 by MundoXRP

[Hodor]

In another section, it's almost like they're making the case for using one-to-many DL's for transacting, with the only caveat being liquidity.  Sound familiar? 

Quote

 With respect to CCPs for cash securities trades, there is discussion of whether concepts like real-time clearing and settlement of such trades would make unnecessary, the use of CCPs to guarantee trades between trade execution and final settlement. This is a logical possibility and could be a case of technology used in a way that makes the need for a settlement guarantee obsolete. However, markets will likely need to evaluate the costs and benefits of the types of changes that financial institutions and FMIs would need to implement for real-time clearing and settlement as well as the financial issues involved in faster settlement such as liquidity management.

 

[mike91]

It's also mentioned on the Ripple website:

https://ripple.com/insights/fed-distributed-ledger-tech-report-singles-interledger/

Three key takeaways from this report:

Distributed ledger technology (DLT) represents an opportunity to deal with existing frictions in payments, clearing, and settlement.

As DLT matures, compliance and governance requirements must evolve along with the technology to extend the existing framework.

An open interoperability standard like the Interledger Protocol (ILP) could spur further innovation and adoption of DLT-based systems for cross-border payments.

[rippleric]

Ryan Z is doing a great job at the fed, looks like he wrote the paper too