We are then using our existing frameworks to respond where necessary. We are disciplined. Just because something is new doesn’t mean it should be treated differently. Similarly, just because it is outside the regulatory perimeter doesn’t mean it needs to be brought inside. We apply consistent approaches to activities that give rise to the same risks regardless of whether those are undertaken by old regulated or new FinTech firms. Some of the most important questions we are considering include: -  Which FinTech activities constitute traditional banking activities by another name and should be regulated as such? 7  -  How could developments change the safety and soundness of existing regulated firms? -  How could developments change potential macroeconomic and macrofinancial dynamics including disruptions to systemically important markets? And  5  For further details on the New Bank Start-Up Unit, see: http://www.bankofengland.co.uk/pra/nbsu/Pages/default.aspx For further detail on the work of our FinTech Accelerator see: http://www.bankofengland.co.uk/Pages/fintech/default.aspx Systemic risks associated with credit intermediation including maturity transformation, leverage and liquidity mismatch should be regulated consistently regardless of the delivery mechanism. 6 7  4  All speeches are available online at www.bankofengland.co.uk/speeches  4  -  What could be the implications for the level of cyber and operational risks faced by regulated firms and the financial system as a whole? To illustrate some of the issues, consider how FinTech is affecting the financial services value chain (Figure 1).

We are a member of Hyperledger along with private market participants and tech firms. 14  And we will make our next generation RTGS compatible with  settlement in a distributed ledger. It is not clear, however, that that the only challenges are technological. Indeed, the FCA highlighted earlier this week that settlement times could also be cut using existing technologies. 15  This requires market  participants to change their collective practices as it takes more than one intermediary in a chain to compress settlement times. Conclusion FinTech’s promise springs from its potential to unbundle banking into its core functions of settling payments, performing maturity transformation, sharing risk and allocating capital. This possibility is being realised by new entrants – payment service providers, aggregators and robo advisors, peer-to-peer lenders, and innovative trading platforms. And it is being influenced by incumbents who are adopting new technologies to reinforce the economies of scale and scope of their business models. FinTech could deliver significant benefits to households and businesses across this country and across the world. FinTech can widen access to financial services and bring new sources of credit. It can connect customers better with their finances and empower them more in the process. And new technologies can deliver faster service, greater choice and keener pricing. 14  Hyperledger is an open source collaborative effort intended to advance cross-industry blockchain technologies. It is a global collaboration which includes leaders in finance, banking, IoT, supply chain, manufacturing and technology.