TLDR:
DLT is a digital system for recording, sharing, and synchronizing transactions across multiple locations without a central administrator, with blockchain being the most well-known form.
DLT vs. Blockchain
All blockchains are DLTs, but not all DLTs are blockchains. DLT is the broader category; blockchain is a specific type using chained blocks and consensus mechanisms.
Why DLT is Important
DLT eliminates the need for a central authority to validate and record transactions, which reduces costs, increases speed, and removes single points of failure. In financial services, DLT enables real-time settlement of securities trades (traditionally T+2), cross-border payments without correspondent banking intermediaries, and tamper-proof audit trails for compliance purposes. Governments and central banks are also exploring DLT for land registries, identity management, and central bank digital currencies (CBDCs).