A central ledger is a digital book that an organisation uses to keep track of all of its financial transactions. Ledgers have been used for a very long time to record and confirm the ownership of assets, the legal identity of individuals, and their legal status and political rights.
The popularization of double-entry bookkeeping in 16th century Italy has revolutionized the use of ledgers in banking and accounting, which played a crucial role in solving the double-spending problem. The technique of recording every entry to an account along with a corresponding and opposite entry in a different account has significantly improved the accuracy of ledger records.
Traditionally, a central ledger is managed by the accounting department of a business to record all economic activity. This approach has disadvantages: relying on a central authority to manage everything makes the ledger vulnerable to any mistakes made by that authority.