Distributed ledgers

A distributed ledger is a technological system that is an asset database that can be shared across a network on multiple sites, geographies, or institutions. All within the system can have access to the ledger via copy or connection to the larger database. Any changes made on any one of the ledgers will be reflected on all the ledgers that currently exist [1]. It's essentially a technological means of keeping accurate and updated records in multiple locations on a large scale. Predominately involved in banking institutions, they are also heavily used within book keeping and the computer sciences.

The Roman Empire's banking system is an early example of distributed ledger technology. At its height, the Roman Empire spanned from modern day Scotland to Syria, and the banking system was designed for an individual to deposit sums of money in any location within the empire. Due to the existence of currency that allowed for the purchase of trading in investment, finance, and real estate, the banking institution of Rome further expanded their distributed ledger technology with the use of paper checks, which in return increased the need for further improvements in updating and recording withdrawals [2]. Due to the copious number of complex business transactions that occurred within the Roman Empire, books recorded by the record keepers were incredibly accurate [3], and the transfer of information between banks in order to keep the records accurate required technological precision.

Chinese records dating back to the early stages of the Qing Dynasty indicate an equally complex distributed ledger system. Piaohao (draft banks) came into existence as the need to transfer large funds rose. Originating in Shanxi Province they were also known as Shanxi banks, as they were owned by Shanxi families. The practice of draft banks eventually caught on and established themselves as centers of commercial trade within the Qing Dynasty. Eventually, with the increase in of the banking industry came the rise of "banking clans", named the piaohao. In total, there were 32 piaohao, with over 475 branches that extended across China and in rare instances, crossed into Japan, Mongolia, Russia, and the Malay Archipelago [4]. Despite the separate piaohao's and extended branches, the technological system was supported by an array of sophisticated record keeping techniques that was supplemented with a heavy amount of communication. In essence, the Chinese banking system of the Qing Dynasty was an incredibly advanced technological system that was able to support the heavy amount of trading with the use of accurate record keeping in the form of distributed ledger.

References

  1. https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/492972/gs-16-1-distributed-ledger-technology.pdf
  2. http://libertystreeteconomics.newyorkfed.org/2013/02/historical-echoes-cash-or-credit-payments-and-finance-in-ancient-rome.html#.V1GF-PkrLcs
  3. http://penelope.uchicago.edu/Thayer/E/Roman/Texts/secondary/SMIGRA*/Argentarii.html
  4. http://www.theworldofchinese.com/2013/12/chinas-first-banks/