Unlocking Financial Inclusion

Introduction

Financial services are a powerful driver of human well-being, enabling businesses to operate and raise capital and households to save, manage economic shocks, and invest in essential needs like education and health. However, across many developing countries, access to affordable and comprehensive financial services—which are key to promoting financial inclusion—remains out of reach for many people. A series of infrastructural, economic, regulatory, and social barriers limit the participation of millions of individuals in financial services.

Technological solutions have the potential to help overcome some of these barriers by lowering costs, promoting competition in traditionally concentrated markets, and better serving consumers’ varied and unique needs. The introduction of mobile phones in the early 2000s removed the need to use physical banking services and simplified onerous identification processes, granting access to payments and credit for many individuals who were previously unbanked. As a result of mobile telephony, today 3 billion people (57 percent of mobile subscribers) use mobile financial services worldwide. In addition, mobile telephony contributed to 5.8 percent of global GDP in 2024, and is projected to account for 8.4 percent of global GDP by 2030.

Over the past decade, innovative developments have come from cloud, mobile, and social technology. Developing countries have mostly seized the opportunity to build and strengthen their own digital public infrastructure, including by innovating with fast payments systems. However, given that those systems still rely on legacy infrastructure, the benefits behind fast payment systems have been primarily contained to domestic markets.

In contrast, the next wave of borderless and truly digital innovations will likely be driven by emerging technologies like artificial intelligence (AI) and distributed ledger technology (DLT). Both technologies hold promise to transform the financial services industry by enabling faster cross-border payments, expanding access to credit, improving financial markets, and broadening retail investment opportunities. These market-based solutions allow for faster, safer, and lower-cost services, empowering individuals to claim a sense of financial autonomy.

AI can streamline account opening and credit, as well as help deliver personalized financial advice and products tailored to individual needs. This technology can support individuals who either lack the skills or the experience to fully benefit from traditional financial services. Separately, by reconfiguring the traditional roles of intermediaries, in principle, DLT—a digital database to record transactions in a shared and secure way—could promote financial autonomy, expand access opportunities, introduce greater efficiency, and unlock liquidity globally. DLT’s inherently transparent, immutable, secure, and tamper-resistant architecture could thus help unlock a range of benefits at a wholesale and retail level.

For the above reasons, there is substantial enthusiasm surrounding the promise of both technologies in the financial sector. Most recently, the Trump administration has taken a new and more proactive approach to DLT with the appointment of a White House AI and Crypto Czar who has been tasked with developing digital asset regulations. In the U.S. Congress, representatives from the cryptocurrency industry are actively participating in hearings with lawmakers interested in establishing legal standards for digital assets. For example, a 2025 bill introduced by the Senate Banking Committee—the Guiding and Establishing National Innovation for U.S. Stablecoins Act (GENIUS Act)—seeks to create a central regulatory body for stablecoins.

DLT has made progress over the last 15 years, with increasing interest and early adoption across sectors. Still, challenges like fragmented governance, limited interoperability, and uneven regulation remain barriers to scale and broader impact. In addition, more evidence is needed to fully understand its benefits compared to the alternatives. Given the many developments taking place in the field of DLT, the body of scholarly work is steadily growing. This paper aims to unpack the main issues discussed in the literature and summarize recent trends in the sector. It examines how DLT could facilitate broader financial inclusion, particularly through the use case of asset tokenization, and explores the risks and challenges the technology brings. While DLT may disrupt the financial services industry, its precise impact remains uncertain: Will it complement or replace existing financial institutions and other proven technologies such as mobile money?
 

How Distributed Ledger Technology Can Advance Financial Inclusion

At its core, DLT is a shared and safe database, similar to a shared Excel workbook.¹ It is decentralized in nature, offering a secure way of conducting and recording transactions without the need for a central authority. DLT is “distributed” because multiple members of a computer network can contribute and sync copies of a single ledger. New transactions are added in a manner that is cryptographically secure, permanent, and visible to all participants in near real-time. DLT can record both static data, like phone numbers, and dynamic data, like digital assets.

Unlike traditional databases, this technology enables peer-to-peer (P2P) information flow, while eliminating added costs from middlemen in the process. In the financial services space, this translates into facilitating quicker and more affordable transactions and money transfers. In addition, DLT can improve transparency and build trust in financial products because transactions are unalterable and traceable back to their origin. This not only eliminates doubt about the integrity of financial data but also fosters trust between participants.

Although DLT is often narrowly associated with digital financial assets like cryptocurrencies, the underlying technology possesses wider capabilities to accelerate transaction speeds, reduce costs, and expand consumer participation in financial services. There are several avenues through which DLT can impact the sector.

• Transparency, traceability, and auditability: DLT enhances efficiency in tracking transactions and spending, helping to reduce fraud and corruption within economies.
• Cost efficiencies: Compared to legacy systems, DLT can significantly lower record-keeping costs, leading to reduced service fees.
• Managing assets: Digital wallets allow societies to rethink how assets are managed and how recordkeeping functions. Without the use of intermediaries, digital wallets allow financial services users more control over their assets, reducing risks in particular for women and other vulnerable populations and providing more secure and private means of managing assets for everyone.
• Programmable money: DLT enables the programmability of assets—transactions that automatically occur once certain rules and conditions are met—thereby allowing for automated processes and expanded use cases for money. For example, project funds can be gated based on milestones, cash disbursements can be restricted to specific uses, and stimulus payments can expire if not used.
• Universal acceptance: Digital assets (such as stablecoins) are increasingly being accepted worldwide. This “universalness” enables significant use cases like global payroll and payment for remote workers.

Within the financial services industry, some of the most promising applications of DLT for advancing financial inclusion include streamlining the account opening and onboarding process, enhancing the efficiency of payments and remittances, improving individuals’ access to credit, and empowering individuals with greater control and ownership over their credit history (Figure 1). These innovations have the potential to make financial services more accessible and transparent for underserved populations.

• Easing the account opening and client onboarding processes: DLT can be instrumental to individuals and firms that want to access formal financial services for the first time. In this context, this technology can be applied in two key ways: (1) enabling digital identification, and (2) enhancing the client onboarding experience.
  
  Over 1.1 billion people in the world lack sufficient proof of their identity. If people cannot prove who they are, they are often denied essential services, including financial services. The Global Findex Database 2021 found that a lack of documentation (e.g., an ID, proof of address, or proof of income) was one of the primary barriers to accessing banking services in low-income countries, with a staggering 27 percent of their population citing identification issues as a reason for remaining unbanked.
  
  DLT can help address identification barriers that keep people unbanked by providing a secure, verifiable, and decentralized digital identity authenticated through cryptographic proofs. For example, three quarters of Sierra Leone’s adult population do not have access to formal financial services due to a lack of identification and credit history. Thus, in 2018, the government of Sierra Leone partnered with the United Nations Development Programme (UNDP), the United Nations Capital Development Fund (UNCDF), and online lending platform Kiva to launch a DLT-based platform to provide citizens with formal identity and give them more control over their own credit information. The Kiva protocol uses biometric data (such as fingerprints) and houses credit information of citizens collected through different means. Other examples where DLT is applied for identification purposes include Ethereum and WorldCoin—cryptocurrencies that use blockchain digital identities based on biometric data (e.g., voice and iris scans) to register, enroll, and authenticate customers.
  
  In addition, DLT can be applied to make the customer onboarding experience more secure, efficient, and client friendly. Financial institutions need to verify who the customers are and understand their personal and business activities to better assess whether these entities carry risks related to fraud, money laundering, or financing terrorism (known as Know Your Customer [KYC] and Customer Due Diligence [CDD] checks). These processes can be time consuming for banks (since they must gather and analyze data for each customer) and are also subject to human error. Moreover, customers must undergo this same process every time they start a new relationship with a bank or financial institution. Using DLT technology, financial institutions could reduce the time and costs associated with these processes while also providing greater visibility to regulators and offering customers a more seamless onboarding experience. Since the information housed in the blockchain becomes a single source of customer data across all financial institutions in a jurisdiction, there is greater visibility and transparency about the activities of customers for regulators. Customers benefit from reduced onboarding times and the elimination of the need to submit duplicate information across multiple financial institutions. For example, in 2017, a consortium of banks in Singapore worked with the regulatory authority to use DLT for KYC processes, which resulted in a cost savings of between 25–50 percent to banks, while at the same time providing a clear audit trail to regulators and a better customer experience.
• Facilitating payments: DLT can also be utilized to enable secure payments (including P2P, remittances, government-to-person [G2P], e-commerce, and humanitarian payments) without the use of a bank account. An individual living in a rural region with no nearby access to a bank can receive money instantly instead of waiting days for the money to process into an account. DLT can also be employed for cross-border payments, including remittances and humanitarian aid. International money transfers through traditional channels can be expensive to users given the many fees that banks and money transfer corporations charge. Moreover, several days can pass before the funds reach the beneficiary. Since DLT enables peer-to-peer transactions—allowing money to move across borders without relying on the corresponding banking system—it has the potential to cut the costs and increase the speed of money transfers. One example where DLT is applied for these types of payments is Everex, a blockchain-enabled remittance provider. The platform claims that it offers remittance services to Myanmar workers in Thailand faster and with lower fees than traditional money transfer services. Another example is Leaf (Leaf Global Fintech), a blockchain-based digital wallet developed in 2019. Leaf enables vulnerable people and refugees to store, send, receive, and exchange currencies on their phones, regardless of whether they are using a smartphone. The service covers users in Kenya, Uganda, and Rwanda and had reached 40,000 beneficiaries as of 2022. Due to its success, Leaf Global Fintech was acquired the same year by IDT Corporation, a global FinTech provider.
• Access to credit and control over credit history and reporting: Another promising application of DLT centers on credit services, offering new opportunities for individuals and businesses to secure financing in more efficient and transparent ways. For example, Grassroots Economics, a blockchain-based project based out of Kenya, worked with UNICEF and the Red Cross on an innovative credit line for communities that do not have collateral or credit history. Grassroots Economics developed the idea of Community Inclusion Currencies (CICs)—tokens that are backed by the goods and services provided by the community, including, for example, a town’s food and water supply, a carpenter’s labor, or a babysitter’s time. Kenyans can use these tokens to create a line of credit that is backed by their own work. In this way, farmers can build credit histories and get loans without using physical currency (Kenyan shillings) or going through a bank. The transactions of these tokens using feature phones are documented on a blockchain. In 2020, 58,400 users of Grassroots Economics carried out transactions worth $3 million in tokens.
  
  DLT can also be leveraged to enhance credit history management and reporting by providing a more secure, transparent, and efficient way to track and verify financial histories. If credit data were stored via blockchain, consumers would be able to directly access their own credit histories and reports, without having to rely on an outside agency. In the United States, in 2023, TransUnion (one of the largest consumer credit reporting agencies) started providing credit scores for individuals that apply for loans on blockchain-based protocols.
   

New financial assets—unbacked cryptocurrencies, utility tokens, and stablecoins, among others—are being created in DLT for a variety of financial- and non-financial-use cases. Various unbacked crypto assets and tokens sold in secondary markets suffer from inherent volatility and the technology, in some cases, can be misused for illicit activities. Other assets, such as regulated stablecoins, enjoy much greater transparency and price stability as they are pegged to fiat currencies, such as the U.S. dollar. Stablecoins are known for unlocking a range of benefits, including faster, cheaper, and more efficient settlement. The market for these myriad assets has grown considerably and, as such, promoting regulatory clarity has been an objective shared by many jurisdictions around the world, with the United States most recently moving at pace to join these efforts and promote their safe adoption.
 

An Emerging Use Case in DLT: The Tokenization of Assets

One of the most prominent use cases of DLT technology—tokenization—has already garnered significant attention from the financial services industry and holds promise for greater financial inclusion. Tokenization is the process of converting real-world or digital assets into DLT-based tokens (or digital representations) that can be securely stored, traded, and transferred. These tokens represent ownership, rights, or access to assets such as currencies, securities, physical goods, real estate, intellectual property, or commodities. While financial assets have been represented on digital ledgers or financial databases for some time (e.g., as liabilities or assets on a bank’s balance sheet), the technological attributes of tokenization are unique and have the potential to transform how retail and financial actors interact with each other and among themselves (Figure 2).

A token can be used across sectors and protects all types of sensitive data, including bank transactions, medical records, criminal records, vehicle driver information, loan applications, stock trading, and voter registration. Tokenization can be applied to financial services, supply chain management, healthcare, real estate, media, and entertainment.² Given its potential to transform several sectors, asset tokenization is projected to be a $16 trillion industry by 2030, representing 10 percent of global GDP, according to research conducted by the Boston Consulting Group.

Since tokenization is built on blockchain technology, benefits to users include added efficiency, faster transfers, and increased transaction transparency. In addition, tokenization has unique features that can enhance the functioning of the financial services industry (Figure 3). Beyond operational efficiencies, tokenization has the potential to broaden investment opportunities as it allows investors to own a portion of an asset rather than having to purchase the entire asset, which can be prohibitively expensive. This fractional ownership gives investors access to asset classes that were previously out of reach. Furthermore, tokenization can provide more liquidity to illiquid assets (such as real estate or private equity), as well as enable easier and faster trading on a digital platform. Therefore, tokenization can open investment opportunities to a wider range of investors, including those who may not have the capital to invest in traditional illiquid assets.

Relatedly, another way tokenization can positively impact emerging markets is by expanding financing options for businesses, thereby providing them with greater access to capital and new growth opportunities. This is particularly important in developing countries where many small businesses struggle to access fresh capital and loans. Tokenization can facilitate private capital flow to small businesses, allowing them to grow, employ people, and pay taxes to their governments.

In sum, asset tokenization holds the potential to significantly promote financial inclusion by democratizing access to investment opportunities, lowering transaction costs, enhancing operational efficiency, and bolstering transparency and security for users. This transformation could pave the way for a more accessible and equitable financial ecosystem.
 

The Challenges of Large-Scale Adoption of DLT and Tokenization

Across regions, sectors, and institutions, there is significant experimentation and innovation using DLT technologies. A 2024 survey of global capital markets participants—including FinTech firms, banks, and fund managers—revealed that 39 percent of the surveyed institutions are adopting DLT mainly to improve internal operations through cost savings. On a regional level, 23 percent of respondents in the Middle East and Africa claimed that their DLT innovations are in the proof-of-concept stage, 25 percent in Latin America declared theirs to be in the development stage, and 44 percent of respondents from Asia and Europe stated that they are in the “live” stage. At the same time, the survey showed that many of these DLT initiatives are fragmented and siloed, involving a limited number of organizations and thus restricting their impact.

Multilateral organizations are also developing DLT applications to enhance internal operations. At the same time, these institutions are launching initiatives and financing innovations for their clients in both the private and public sectors (Box 1).

In Latin America and the Caribbean, the Central Bank of Brazil launched a new blockchain pilot project called Drex Pilot (also known as the Real Digital) to develop a CBDC (central bank digital currency) in 2024. On the continent of Africa, South Africa is experimenting with blockchain technologies, including startups like Ice3x and Luno (both cryptocurrency exchanges), as well as Custos Media Technology, GeoPay, and Bankymoon (which use blockchains to address challenges such as international money transfers and online piracy). Moreover, central banks are testing the use of digital currencies as ways of fortifying financial inclusion in, for example, Ghana, Nigeria, and South Africa, all of which are running pilot projects. In Asia, there are government initiatives to develop DLT frameworks and regulations. One example is the Monetary Authority of Singapore (MAS), which began utilizing blockchain and DLT for settlement and clearing systems. MAS is responsible for the Singapore Exchange (SGX), which successfully created a public digital bond using a DLT-enabled platform in 2020.

In the case of tokenization, there is limited public data on these transactions globally, including the overall market size and more disaggregated information by different classes of tokens and their actual market growth. Although the first tokenization transaction happened in 2017, few assets have been tokenized aside from cash (in the form of stablecoins) and bank deposits.

Despite the significant innovation taking place and the clear institutional appetite for it, DLT has not yet reached the level of adoption necessary to be considered systemically significant. There are several barriers that hinder widespread adoption of these technologies (Figure 4). The most important barriers to support DLT at scale include regulatory uncertainty, a lack of standardization, and the need for interoperability (specifically between DLT platforms and traditional payment systems, and between different DLT platforms). There are also risks involving, for example, differences in the governance of the networks, cybersecurity, and legal ambiguity. As a result, DLT’s mass adoption has been slow, and its long-term success will depend on overcoming these barriers while taking actions to mitigate these underlying risks.

As of early 2025, the regulatory landscape for DLT and tokenization is still developing, with no single, universally accepted framework having emerged. Countries have moved at different speeds and have taken different approaches to regulating this nascent sector. In addition, there are no binding international standards in place. The inconsistency of global regulations creates unnecessary uncertainty and complexity for businesses. For example, some jurisdictions do not have policies that directly address the novel considerations DLT brings, instead relying on laws regarding the transfer of private information or payments and securities laws designed with traditional financial assets in mind. Due to differences in laws and policies that are tied to digital assets and activities associated with the technology, DLT deployment remains fragmented.

While the European Union and other advanced economies, such as Hong Kong and Singapore, have already introduced legislation aimed at standardizing legal frameworks, a majority of the developing world is still jurisdictionally fragmented. Assimilating the regulatory and legal policies between various jurisdictions would alleviate potential legal friction and promote greater adoption.

The Financial Stability Board (FSB), which has jurisdiction over all G20 economies, has been very active in producing guidelines and recommendation regarding blockchain and crypto activities. In fact, it just finalized its regulatory framework for crypto-asset activities in order to promote regulatory comprehensiveness and consistency. This is a major step toward a more globalized standard for token usage and could provide a regulatory framework for developing economies looking to flesh out their DLT strategies. Additionally, the FSB’s 2023 G20 Crypto-asset Policy Implementation Roadmap is a comprehensive strategy aimed at addressing the challenges posed by cryptocurrencies and is primarily centered around regulatory frameworks.

In addition, the current state of interoperability, which allows different DLT networks to connect and exchange information with each other without restriction, makes the implementation of the technology in the most needed areas extremely difficult. Unlike mobile technology, where a person can call or text another person without needing the same cellular network, most DLT applications lack interoperability both with each other and with legacy systems. Each DLT platform typically operates in isolation, which hinders the integration of services with other systems. As a result, DLT applications within the financial services sector remain fragmented and siloed, with many still at the proof-of-concept stage.³

Integrating blockchain and tokenization technologies with legacy financial systems presents additional technical challenges. The current financial market infrastructure is not compatible with the decentralized and digital nature of DLTs and requires substantial investment in new infrastructure, as well as the acquisition of skilled talent and employee training. In the case of tokenization, institutions must invest in updating their middle- and back-office workflows to accommodate tokenized assets. Additionally, during the transition to new technology, institutions will need to run digital-twin operations (e.g., managing both digital and traditional settlement, and other functions) to mitigate operational and regulatory risks. These hurdles mean that institutions need a strong business case to justify making this transition.
 

DLT Adoption in Emerging Markets

While there is a flurry of experimentation and innovation surrounding DLT in emerging markets, significant disparities with advanced economies introduce additional complexities that hinder the widespread adoption of these technologies. A combination of economic, infrastructure, and social challenges—such as low levels of financial and digital literacy, limited access to essential digital and energy infrastructure, and potential risks to financial stability—pose unique barriers that must be addressed in order to scale DLT effectively.

Due to weak digital and financial literacy, individuals in emerging markets do not fully recognize the risks and benefits of these technologies. Blockchain, in particular, is not well understood by the public and its benefits are not adequately documented and communicated to consumers. In a 2024 survey of 18 developing and advanced countries, most respondents did not get the definition of blockchain right, except for interviewees in Nigeria and South Africa. This skill and informational gap prevents individuals from engaging effectively in decentralized finance.

Moreover, DLT is often confused with cryptocurrency, complete with the latter’s negative connotations. Media coverage frequently centers on examples of cryptocurrency misuse such as authoritarian regimes attempting to circumvent Western sanctions (e.g., Russia’s use of Bitcoin) or cryptocurrency scandals (e.g., the meme coin $Libra and the theft of nearly $1.5 billion in ByBit coins by the North Korean criminal organization known as Lazarus Group), instead of the benefits of the technology.

In addition to the previously mentioned challenges, DLTs require significant investments in hard infrastructure and can consume massive amounts of energy for computing power. As these technologies expand and the world faces an increase in demand for data centers and computing power, the financial and energy costs will only grow. However, many developing countries do not have access to affordable and reliable energy sources and, moreover, lack the resources to invest in digital infrastructure. As of February 2024, the energy demand generated by current crypto assets was between 0.4 and 0.9 percent of global energy usage. Bitcoin mining (the term used to describe the process in which bitcoins are validated and recorded) required the equivalent of about 50 days of power usage by the average U.S. household per bitcoin in 2022. With roughly 200,000 bitcoin “mined” per year, the energy needs are enormous. To put this in the context of expanding DLT and blockchain technology access, approximately 770 million people worldwide do not have access to reliable electricity, mainly in Africa and Asia.

Finally, an additional consideration for developing countries is that DLT adoption without clear rules and standards has the potential to introduce new risks that could impact the overall stability of their financial systems. Although DLT fosters a more democratized financial system by offering consumers greater financial choices, it could present a complex trade-off between consumer choice and the country’s financial stability if its adoption is not managed appropriately. In the case of stablecoins, for example, there is growing popularity for using these digital assets as trading and settlement vehicles and as means of payments across jurisdictions, but lack of oversight (including of stablecoin issuers’ reserve backing model) may undermine the effectiveness of a country’s regulator over their financial system.

This is especially challenging for emerging markets, which must navigate a complex landscape of competing economic and social priorities. To offer guidance and help jurisdictions navigate these risks, the FSB has issued 10 recommendations aimed at ensuring consistent and effective regulation, supervision, and oversight of stablecoins across jurisdictions while also encouraging responsible innovation. Regarding the tokenization of assets, a 2024 FSB report highlighted the additional vulnerabilities the mass adoption of the technology could pose to the financial system, but concluded that it did not yet present significant risks to the stability of the financial sector given its small-scale usage.
 

Conclusion: Navigating the Future

Innovative technologies will continue to transform the financial landscape. With DLT driving a shift of the industry to a broader democratization of finance, there is a significant opportunity to leverage this technology for better development outcomes.

As new developments emerge in this space, it is crucial to address the barriers and mitigate the risks while ensuring that the technology fosters equitable financial access and upholds the stability of the global financial system. The path forward is both challenging and exhilarating, with several key considerations warranting deeper reflection:

• Regulators must balance innovation and regulation. Like any new technology, DLT presents challenges to regulators who want to foster innovation while ensuring sufficient regulation to protect users, maintain financial stability, and prevent misuse. Striking the right balance is crucial—too much regulation can stifle innovation, whereas insufficient oversight can lead to fraud, market manipulation, and security breaches, to name just a few risks. As DLT evolves, regulators must remain flexible and adaptive, allowing for the rapid development of new applications while maintaining a framework that ensures transparency, accountability, and consumer protection. Effective regulation should support responsible innovation, promote trust, and allow the technology to reach its full potential without compromising financial stability or user safety.
• The rapid global rollout of emerging technologies demands heightened focus on international cooperation to establish interoperability and standardized practices. As new systems and technologies proliferate across borders, the need for a more cohesive approach has become increasingly apparent. Ensuring that various systems can seamlessly communicate with each other will require substantial investments in infrastructure, as well as robust international collaboration to set common standards and protocols.
• The benefits to users and market players are not yet widespread, and may even be unknown. For users to fully embrace this innovation, they need to understand the value it brings in real terms—whether it’s in terms of cost-saving, increased transparency, or enhanced security. Stronger, more accessible case studies and practical examples are needed to demonstrate how this technology can drive real-world benefits.
• In international development, multilateral and bilateral organizations have a unique opportunity to integrate and promote this technology. Multilateral institutions are already experimenting and applying DLT both for internal purposes and to help their clients. DLT could streamline and improve processes such as payroll systems, the disbursement of grants and loans, contractor payments, and the delivery of humanitarian aid in challenging environments. In the United States, given the foreign assistance reform taking place under the Trump administration, there is a valuable opportunity to leverage DLT not only to track funding but also to make the entire foreign aid value chain more efficient, transparent, and accountable.
• It is essential to educate consumers on both the benefits and the risks of this technology. Although DLT is rapidly evolving, educational institutions must improve their digital and financial literacy offerings so that students are better equipped to engage in decentralized finance. Financial institutions can also play a role in educating their clients, especially when onboarding customers. Media narratives need to shift toward DLT’s positive applications and transformative potential across various sectors, highlighting its benefits beyond the realm of cryptocurrency.
• Finally, will this technology complement or replace traditional banking and financial institutions? This is a critical question for the future of financial ecosystems. The potential for DLT lies in its ability to both enhance and work alongside existing financial and banking structures. While it may not replace traditional institutions entirely, it could significantly transform and improve efficiencies, streamline operations, and offer new avenues for financial inclusion.
   

As the adoption of DLT and other technological applications continues to expand, so too does the body of research exploring their impact on financial inclusion and financial stability. This rapidly growing field of scholarly inquiry is poised to play a pivotal role in shaping the future of the industry, offering valuable insights and evidence to guide policy development. This paper aims to summarize some of the key issues emerging in this area and hopes to inspire greater engagement from academics, policymakers, and leaders across various sectors to contribute to this critical conversation.

Romina Bandura is a senior fellow with the Project on Prosperity and Development at the Center for Strategic and International Studies (CSIS). Madeleine McLean is a program manager and research associate with the Sustainable Development and Resilience Initiative and the Project on Prosperity and Development at CSIS. Esteban Cherquis is an intern with the Project on Prosperity and Development at CSIS.

The authors would like to thank Sebastian Barassi for his research support. This paper also benefited immensely from the insights of two CSIS seminars held on December 12, 2024, and February 21, 2025. Finally, special thanks to the four anonymous reviewers who provided feedback on an earlier draft.

This paper is made possible through the generous support of Hashgraph Foundry Inc.

Please consult the PDF for references.