Stablecoin Payments Glossary
Off-Chain Settlement
Off-chain settlement refers to payment processing or netting that occurs outside the blockchain ledger.
Explanation
In some systems, user balances may be updated internally by an exchange, wallet provider, or payment processor without each transfer being recorded individually on-chain. Final net settlement may occur later on the blockchain or through banking rails.
Why it matters
Off-chain settlement can reduce costs and improve speed, but it introduces reliance on intermediaries and reduces ledger transparency.
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