Distributed Ledger Technology
DLT: The Future of Spanish Financial Instruments
Distributed Ledger Technology (DLT) is revolutionizing the way in which financial transactions are being conducted. It's a set of technologies that allow the design of a series of systems that function as a non-centralized database. In Spain, the National Securities Market Commission (CNMV) is considering DLT as an option for current financial instruments, once the Law of Securities Markets and Investment Services is approved.
The Benefits of DLT
The idea of a decentralized database that is tamper-proof and secure is not new. However, with DLT, it is now possible to achieve this kind of data security with greater efficiency and speed. The simultaneous exchange and updating of records makes the whole process faster, more efficient and economical.
Montserrat Martínez-Parrera, Vice President of the Spanish National Securities Market Commission (CNMV), believes that blockchain technology is essential to achieve a financial system that truly becomes a digital asset. She is of the opinion that the years ahead will be exciting for DLT, and sees it as an alternative for current financial instruments.
DLT ensures a higher degree of decentralization and is cataloged as a safer system, making it nearly impossible to be hacked. This makes it a preferable option for companies and organizations that are looking to secure their databases. Currently, many companies have their databases separated in different locations to ensure a minimum degree of decentralization. However, each location is in a connected central system that makes them vulnerable to cyberattacks or local problems.
One of the main benefits of DLT is that there is no central computer or server collecting information, which makes the system much safer. This ensures that there is no single point of failure, which makes the system more robust and resilient. The simultaneous exchange and updating of records also makes the system much faster and more efficient.
CNMV's Opinion on Cryptocurrencies
The CNMV has always emphasized that cryptoassets have been an essential part of the emitted regulations, and warned that investments in cryptocurrencies always carry risks. However, the president of the CNMV, Rodrigo Buenaventura, opposed cryptocurrencies and described them as socially useless and uninteresting. He maintains that private capital is excellent, but it is not a mechanism of long-term stability in which organizations can trust in 10 or 20 years, as public markets do.
Conclusion
Distributed Ledger Technology (DLT) is the future of financial transactions, and the Spanish National Securities Market Commission (CNMV) is exploring it as an option for current financial instruments. While the technology is not entirely new, it is a much safer and efficient system that ensures a higher degree of decentralization. Matwal Solutions follows the strictest legality of the jurisdictions where it is present, ensuring that its services are fully compliant with all regulations. To learn more about Matwal Solutions and the services it offers, feel free to contact us.