The four most famous international exchanges:

Binance INTL	OKX INTL	Gate.io INTL	Huobi INTL
China Line　APP DL	China Line　APP DL	China Line　APP DL	China Line　APP DL

Note: The above exchange logo is the official website registration link, and the text is the APP download link.

As we all know, the development of blockchain technology has brought many concepts to everyone's lives. Now is a new era in which innovative use cases can be developed with the help of blockchain. Blockchain and distributed ledger technology provide trust and security without the need for middlemen, intermediaries or arbitrators. This reduces friction and costs for all parties, and transaction settlement can be completed in seconds. The resulting cost savings are huge, can be passed on to consumers, and can also greatly simplify the post-transaction transfer cycle. So what exactly is this blockchain settlement method? Let the editor of the currency circle introduce this blockchain settlement method to you.

 What is the blockchain settlement method?

The blockchain settlement method is that transactions are settled. The technical reason is that the exchange, China Central Securities Depository and Clearing Corporation, and banks are three different institutions. Simply considering buying and selling stocks on the exchange, your transaction time is actually calculated in seconds, but this second-level transaction is only limited to the information level.

You also need the central securities registration and clearing agency to actually complete the transfer of ownership, and then you need to complete the transfer of funds through the bank. Once other institutions other than the exchange are involved, reconciliation and settlement processes between institutions are required. This process is time-consuming and this is the reason for the inefficiency.

In addition to stocks, the same is true for other assets, and the same is true for currencies. The efficiency of transfer itself can be very high, but the clearing and settlement process is very complicated. For example, when we make cross-border remittances, it can be received in real time in China. Why does cross-border remittances take so long? time? Stuck there? Stuck on cross-border settlement.

The blockchain represented by Bitcoin creatively uses the UTXO system. This is a very significant innovation, allowing the blockchain to realize transaction settlement, which can greatly improve efficiency and reduce costs.

 The role of blockchain settlement

1. Convenient personal payment and settlement methods: Under the wave of digitalization, personal payments in my country have gradually transitioned from mainly paying with banknotes and debit cards to payment methods such as the Internet, mobile phones, and QR codes, which has effectively facilitated the payment experience of the masses.

With the gradual accumulation of national wealth, the demand for personal cross-border transfers is also increasing, and traditional inefficient businesses have been widely criticized. With the development of blockchain technology, it can be used as an interface between payment institutions and commercial banks to achieve multi-party collaborative information processing, effectively improving information transmission and processing efficiency, and enabling safe and traceable exchange operations between different currencies. It further facilitates personal cross-border payments.

2. Reshape the trade clearing and settlement system: When enterprises conduct foreign exchange settlement of international trade, they must settle through third-party financial institution platforms, which is often extremely inefficient and requires payment of settlement fees, causing additional burdens on the enterprise.

The development of blockchain technology has made it possible to build a new and convenient clearing and settlement network. It has the characteristics of decentralization, non-tampering, openness and transparency, and has natural advantages in clearing and settlement. At present, many governments around the world have invested in and built distributed accounting systems, and many multinational companies have also joined different blockchain alliances, trying to build new clearing and settlement systems through blockchain to further improve settlement efficiency and fund utilization. level.

3. Improve the efficiency of industry chain clearing and settlement: Under the current background of the country's vigorous advocacy of the digital transformation of the industry chain, the blockchain can realize the transparency, openness and sharing of industry chain information through distributed information storage, and ultimately form a product-based Information flow is the main body, and the information architecture supported by business flow, logistics, and capital flow eliminates information asymmetry factors, enables commercial credit to be effectively transmitted and used among industrial chains, and also makes payment and settlement for enterprises in the industrial chain more efficient. Convenient and efficient, it effectively improves the operational efficiency of the industrial chain.

The above content is a detailed introduction by the editor of the currency circle on the issue of what is the blockchain settlement method. Having a distributed model that is constantly updated to record ownership and shared among participants, blockchain settlement can greatly simplify the process of post-trade transfer cycles and eliminate the need for centralized backup systems. Blockchain can even help introduce settlement mechanisms that have been traditionally excluded due to inefficiency or reification. Land titles, certifications, intellectual property rights, etc. can be securitized. Securities, stocks, currencies, bonds, bonds, land titles, intellectual property can now be integrated to form a single settlement station, which can also be modified to exchange not just currencies, but other instruments as well.