Thus, one cannot say that privatisation has been as yet accomplished fully. What remains, however, is a more standard situation, posing similar problems as privatisation of state-owned companies in the advanced market economies. As to the future prevailing model of corporate governance, the Czech Republic can be expected to converge toward the practice which will be most widely observed within the European Union countries. Macroeconomic stabilisation The transformation strategy required a constant effort to achieve macroeconomic stabilisation. Tight fiscal policy, based on a balanced or surplus state budget, and prudent monetary policy, were mutually supporting each other. These were supplemented by wage controls and overall income policy within the so-called heterodox concept of macroeconomic stabilisation. During transformation, Czech monetary policy used two basic tools to fight inflation: targeting monetary aggregates, and the nominal anchor of a fixed exchange rate. The Czech experience with curbing inflation during a transformation period is successful, compared to other transforming economies of Central Europe. When, in January 1991, the bulk of prices in the Czech economy were freed after 40 years of central price fixing, the result was a yearly increase of the price level by almost 58%. However, no inflationary spiral evolved, and, since 1992, inflation showed a falling long-term trend towards a single digit rate in 1995-1996. BIS Review 25/1997  -5-  The initial jump of prices in 1991 was not accompanied by a similarly steep increase of nominal wages. Instead, real wages fell. That created some room for subsequent increases in real wages without serious inflationary consequences.

•  Authorities have already taken significant steps to design a regulatory framework that could stimulate innovation while preserving financial stability. The European MiCA regulation is a necessary first response to regulate the use of crypto-assets and it needs to be implemented as soon as possible. However, let me stress the MiCA regulation is not an end in itself but rather the start of a process. Our regulatory framework will need to be adjusted on a regular basis to keep up with the development of DeFi. •  In addition, these responses from public authorities need to be coordinated at the international level, to avoid arbitrage across jurisdictions. International bodies have a central role to play in coordinating responses, notably the BIS and the FSB, but also the IMF and the OECD. Page 2/3  My third takeaway is that central banks could accompany usefully the tokenization of finance, by leveraging new technologies to provide central bank digital currencies, thereby improving the efficiency of securities settlement and payment systems. •  The discussion showed that this possible positive impact is not confined to retail payments. o A wholesale CBDC directly integrated on DLT could be used to settle tokenised assets, bringing the security of central bank money. In addition, a wholesale CBDC has the potential to improve cross-border payments. o But we need to properly measure the economic impacts and the associated risks. That is why we are working on it step by step, including through experimentation with private actors.