A Proposed Hybrid Distributed Ledger Architecture for Cross-Border Payments: Design and Conceptual Framework

This paper presents a conceptual architecture for a hybrid distributed ledger system designed to address challenges in cross-border payments and remittances. Current payment infrastructure suffers from high costs, slow settlement times, and limited transparency. While cryptocurrency-based public blockchains and permissioned enterprise systems have been proposed separately, a comprehensive framework integrating both approaches with traditional payment rails remains lacking. We propose a multi-layered architectural design that combines Hyperledger Fabric for inter-bank settlement, R3 Corda for bilateral agreements, and existing payment systems for retail transactions. The proposed system incorporates consensus optimization strategies, atomic cross-ledger transaction protocols, and automated regulatory compliance mechanisms. Through architectural analysis and comparison with existing systems, we identify key design principles for scalability, interoperability, and regulatory compliance. This work contributes a detailed architectural specification and identifies critical research challenges requiring future investigation, including performance optimization, security validation, and regulatory framework development. The proposed architecture serves as a foundation for future implementation and empirical evaluation.