Instant Settlement Network Layer

Understanding the Instant Settlement Network Layer

An instant settlement network layer is a system that enables participants to exchange various digital assets on a large scale, regardless of their location. These networks facilitate real-time settlements between participants, both on and off-chain, thereby reducing counter-party risks. These networks can be accessed through APIs and online portals, providing a seamless platform for asset exchange.

Transactions on instant settlement networks occur in real-time, 24 hours a day, without any waiting period. Each transaction is settled individually, without being grouped with other transactions. This ensures that settlements are made on a gross basis, without any delays.

In addition, transactions on these networks are final and cannot be reversed. If the participant has sufficient funds in their custody account, the settlement is immediate and irrevocable. The introduction of instant settlement networks has revolutionized the transfer of digital assets across different blockchains, eliminating the need for unnecessary intermediaries.

Author: Gunnar Jaerv

Gunnar Jaerv is the chief operating officer of First Digital Trust, a technology-driven financial institution in Hong Kong. He has a strong background in the tech industry, having founded several startups including Peak Digital in Hong Kong and Elements Global Enterprises in Singapore.