Frantic Treasury officials tried to correct the Chancellor’s mouse-handling technique – but they needn’t have bothered because the equipment had wisely been disconnected from anything that mattered. Indeed, CREST had already been running for some hours… Figure 1: The official launch of crest (15 July 1996)  CREST itself was far from a publicity stunt, however. Its introduction finally enabled the much-needed dematerialisation of equity settlement into electronic form, sweeping away the antiquated paper-based Talisman system, bringing some of the UK’s most important financial market plumbing into line with its front office systems, and catapulting it towards best-in-class internationally. Today, CREST accounts for half of the payments processed through the Bank’s RTGS system – around a quarter of a trillion pounds every day. BIS central bankers’ speeches  1  The launch of CREST was a particularly important moment for the Bank of England, because the team that designed and built CREST was drawn predominantly from the Bank’s own staff, hurriedly called into service after the disastrous collapse of the Stock Exchange’s own project to dematerialise equity settlement, “TAURUS”. Indeed that time also has an important place in my memories. My first job at the Bank was in its Financial Markets and Institutions Division, one of the areas from which the CREST team was taken. I vividly remember the gaping hole left in the office, complete with empty coffee cups and discarded paper files, when the team left for their new premises.

Taken together, these requirements are designed to bring about a material increase in the stability of the system as a whole – but in terms of their influence on the structure of the market, they also amplify the impact of the demand and technology drivers, further intensifying the pressures towards rationalisation and convergence. What is the Bank of England’s role in all of this? Our primary objective is, as it has always been, to maintain monetary and financial stability. But that does not mean holding back innovation or competition. Far from it: our role should be to help enable these things, where that can be done in ways that do not compromise stability. That could include: modernising risky, out-of-date systems; reducing single points of failure by increasing interoperability and reducing concentration; strengthening protections against cyber attack; improving risk management; and reducing operational and settlement risk by reducing settlement periods. We pursue our objectives in three ways: –  First, through the use of our balance sheet. Ensuring that settlement occurs in central bank money has been a major achievement of the past twenty years, and it is important that this should continue, however the structure of the market develops in future years. That is a central design principle of the proposals we recently announced for the new generation of RTGS, and will be delivered though broader access for infrastructures, adoption of ISO 20022 as the new messaging standard, maintenance of the existing DVP link for CREST and regular FX settlement for CLS,  8  http://www.oliverwyman.com/content/dam/oliver-wyman/global/en/2016/feb/BlockChain-In-Capital-Markets.pdf.