Different between Blockchain and DLT

Different between Blockchain and DLT

Interview Technology
June 1, 2020 by admin
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Distributed ledger technology (DLT) is a digital system for recording the transaction of assets, in which their details are recorded in multiple places at the same time. The technologies eliminate the authority's middling to increase the speed of the process. It reduces transactional costs as well. Distributed ledger technology is known for the distribution of information among many sources, due to which the security is heightened. Meanwhile, it decreases the possibility of cyberattacks. The technology can be adopted by many areas such as government and business dealings, in addition to financial transactions. Experts mention other functions for it as well including tax collection, property deed transfers, social benefits distribution, and even voting procedures. But we still can’t limit the uses of the technology to the mentioned areas since it could be used for personal uses as well. As mentioned, the government can also make use of technology for data transactions.
Different between Blockchain and distributed ledger technology (DLT)

So far, all the explanations on the DLT make us ask, so what is the difference between Blockchain and DLT? Most of the mentioned options, including being decentralized, distributing data, and having lower transactional costs, are common among both. Regardless of these similarities, they aren’t identical. While they both offer decentralized information distribution and foster transparency, the data distribution goes through a different process for each of them.

Some features regarding Blockchain that differentiate it from DLT are presented here. First and the most important feature was stated by Piekarska, the director of the ecosystem at Hyper ledger, he named it “permissionless” by which he referred to the availability of data for everyone once they become a node. In other words, anyone can access Blockchain, serve as a validating node, once they become a node. Another feature is the time-stamp Blocks. Each block is developed using a crypto-graphical validation for the Blockchain and cryptocurrencies of that specific time it was designed on. Bitcoin’s core developer, Kalle Alm, explains how the design improves the security of Blockchain. He explained:

“Blockchain alleviates the trust required in a shared timestamped database. For a public cryptocurrency, this is obviously necessary or someone might just go and give themselves a million USD, but for a private database, especially when it is not a cryptocurrency but some more abstract form of smart contract platform, it starts to make less and less sense.”

Although DLT doesn’t use the chain blocks, it relies on notaries. The nodes that allow the users to come up with a specified time agreement. So knowing these differences Phil Chen, was probably right when he declared the technology is just a shared database since it doesn’t have the features that made Blockchain different from others. His declaration reads:

“In the enterprise space, people are talking about private Blockchains, which technically are not Blockchains but a better database management system. Nevertheless, it does have productivity gains; I call it a 9 to 10 innovation, whereas public Blockchains like Bitcoin and Ethereum are 0 to 1 innovations that completely change the way we think and use money and computation. Bitcoin is a true public Blockchain that is open, neutral, censorship-resistant, and borderless. And distributed ledgers are simply permission databases.”

To sum up – The explanations about both of them are almost the same if we don’t dig into details, but there are some differences. In my opinion, Piekarska’s statements regarding the differences between these two technologies can clarify everything since he mentioned the most important difference. The following is what he mentioned about the issue.

“First and foremost: one is permissionless, the other is permission. This means that in the first case anyone can participate in the network, in the other: only chosen participants have access to it. This also determined the size of the network: Bitcoin wants to grow infinitely, while in a permissionBlockchain space, the number of parties is smaller.”

So far, although we know there are some minor differences in the way they preserve information and the features they provide, the feature mentioned by Piekarska was the most important one. We can’t say that DLT is not beneficial, though since technology helps private sectors, and it adds another progress to a global perspective.

References
https://searchcio.techtarget.com/definition/distributed-ledger
https://tradeix.com/distributed-ledger-technology/
https://cointelegraph.com/news/what-is-the-difference…

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