Re:A quick breakdown of what SWIFT is and why it matters
by JumpCrisscross on Saturday February 26, 2022 @10:08AM
(#30478104)
> other people know how much money that bank should have based on transactions it has made?
Approximately. Everyone keeps a running total of their bilateral transactions. This summing and sharding reduces information. But it also decentralizes accountability in a robust way.
Add occasional audits (which allow trusted persons to evaluate the transaction record), and some of those parties' books (in the aggregate) being public record, thereby permitting every party (including third parties) to compare their books to theirs, and you get a system which tends towards accuracy.
Approximately. Everyone keeps a running total of their bilateral transactions. This summing and sharding reduces information. But it also decentralizes accountability in a robust way.
Add occasional audits (which allow trusted persons to evaluate the transaction record), and some of those parties' books (in the aggregate) being public record, thereby permitting every party (including third parties) to compare their books to theirs, and you get a system which tends towards accuracy.