DLT or Distributed Ledger Technology uses a decentralized database to store transactions stated Bahaa Abdul Hussein. There are different types of DLT and one of the most prominent ones is Blockchain. It is well-known that cryptocurrencies use blockchain DLT. So, what are the other forms of DLT and what are the differences. Let’s delve deeper.

Different forms of DLT

Distributed Ledger Technology stores data in the form of data blocks across a network of computers. While Blockchain is most commonly associated with DLT, there are other forms too. The different DLT types are briefly explained:

Blockchain

Blockchain is the most popular DLT. Here records of transactions are stored in a ledger in the form of a chain of data blocks. Multiple blocks can be added to the blockchain ledger.

Hashgraph

 In a hashgraph, multiple transactions are stored under the same time stamp. Transactions are stored using a parallel structure. Verifier nodes includes all transactions in the same order.

DAG

Directed Acyclic Graph works by validating two previous transactions randomly. It is an improvement to blockchain in terms of scalability.

Holochain

In this form, it moves to an agent-based approach than data-based. It uses a hologram concept with individual modules used to create the ledger and network.

Tempo

It is a new form of DLT that allows for greater scalability. Nodes can carry subset of the entire ledger. Such a system allows for increased traffic.

Difference between Blockchain and other DLTs

 Many people believe is Blockchain is DLT and DLT is blockchain. While the former is true, the latter is not. Blockchain is a form of DLT, but not the only DLT. Blockchain is considered the parent of all other DLT forms. A few differences exist that must be understood.

  • DLT does not need tokens, but blockchain uses tokens.
  • DLT does not call for a specific data sequence, but blockchain has a series.
  • The trust among the various participating nodes is less in blockchain than in DLT.
  • DLT is more efficient than Blockchain when you consider number of transactions per minute.
  • Blockchain needs a key and loss of the key can be devastating. This is not the case with DLT.
  • In terms of implementation, blockchain’s use is more widespread than other DLTs.

Conclusion

Different types of DLT are available, each of which has its own features and benefits. The most popular is Blockchain, which is used in cryptocurrency as well as in other applications. Its multiple use scenarios make blockchain the DLT for the future. Thank you for your interest in Bahaa Abdul Hussein blogs. For more information, please visit www.bahaaabdulhussein.com.