The RLN concept envisions a theoretical payment infrastructure designed to support the exchange and settlement of regulated digital assets using distributed ledger technology (DLT).

Problem Space

While existing payment systems function effectively, certain frictions remain, particularly around speed, cost, accessibility, and the settlement process.

Distributed ledger technology has enabled certain capabilities in asset exchange, like a common source of truth and atomic settlement, but current designs for exchange mechanisms based on DLT do not enable the interoperable transfer and settlement of digital assets between regulated financial institutions.

Experiment Design

To test the RLN concept, the proof of concept working group (participants listed below) led three workstreams that researched and analyzed the technical feasibility, business applicability, and legal viability of the concept.

As part of the research study, the working group designed a distributed ledger-based network to settle payments between financial institutions using tokenized regulated commercial bank and central bank liabilities. The experiment was conducted in a test environment and used only simulated data. All simulated liabilities were denominated in U.S. dollars (USD).