happens that the assumptions and concepts stem from the very far right. in bitcoin literature as much as in central bank conspiracy writings, the fed is said to hide “ its real purpose ; that it steals money from some private citizens and put it in the hands of the ‘ elites ’ that control the fed ; that the fed itself is covertly run by a shadowy group of elites, often made up of jews and members of the english banking families such as the rothschilds ”. they also put forward more subtle arguments ‘ that inflation and deflation are caused by monetary policy rather than by more conventional aspects of economies like commodity and assets prices, productivity and other aspects of labour and so on. ’ whilst the argument that cryptocurrencies eliminate fees, charges and other cost of intermediation is no doubt valid, the argument that they are a very convenient means of laundering money is equally valid. some observers say bitcoins and altcoins are not currencies but commodities that are being traded like any other commodity on the exchanges. they are currently serving as speculative investment instruments playing almost no role as a means of payment. in terms of economic significance, they are said to have minor importance. some others say it ’ s just a scam. it does not physically exist. it is invisible. but a golden coin on posters is used for purposes of advertisement. it is also said that the word ‘ mining ’ in the digital creation of the bitcoin and altcoins is used to give the impression that it ’ s gold that is being mined. still some others argue that it ’ s a convenient means to avoid income tax and vat payments. central bankers have been seeing this game differently from afar since 2009. what is money? what ’ s the definition of money? how broad is the definition of money? if cryptocurrencies are money, anything else can, of course, be construed as money. take for example the banknotes and coins in your wallet. they are an asset owned and held by you. the same banknotes and coins appear on the liabilities side of the balance sheet of the legally constituted issuing authority which is the bank of mauritius. it necessarily means that the bank has an obligation of the stated amount vis - a - vis you, and is accountable to you. at any point in time, anyone of you can examine the balance sheet of the bank of mauritius to see the quality and the value of assets held against the currency in

your wallets. in the case of cryptocurrencies, the question of liabilities does not arise at all. they are your assets if you acquire them but they are liabilities of nobody in this world. nobody has an obligation to the holders of cryptocurrencies in the manner a central bank does have for the currency it has issued. i do not wish to burden the audience this afternoon with technicalities and arguments that might sound academic to disbelievers but which are indeed of fundamental importance to central bankers having financial stability as one of its mandates. reportedly, there are more than 1, 300 cryptocurrencies registered on different exchanges worldwide. it necessarily goes to say that there are more cryptocurrencies than national currencies. how do we recognize them and who is who in this vast jungle? and how do we effectively regulate them? since 2011, there have been at least three dozen heists of cryptocurrency exchanges. nearly one million bitcoins equivalent to over us $ 4 billion at current prices have been found missing between october, 2011 and april, 2017. legions of investors and speculators have been left holding their bags empty ; they are at the mercy of the exchanges for any possible compensation. would you as a money - lender accept cryptocurrencies as collaterals? does it augur well for financial stability? anyone of us sufficiently conversant with digital technology, must be aware that clever algorithms churn through a massive history of everyone ’ s behaviour in the internet to predict your own behaviour. and those who have a compulsive gambling behaviour needs to bear in mind that cryptocurrency exchanges are not manned by professors of ethics and morality. may i however seize this opportunity to state that in discussions about cryptocurrencies one crucial aspect in the digital evolution of the means of payments and settlements is often overlooked : a vast majority of money in a modern economy is already electronic money. in mauritius, nearly rs3 trillion of transactions are settled electronically on an annual basis. this figure represents 6 times the gdp of mauritius implying that our payments and settlements by electronic means are quite intensive and are ever growing. we expect the value of transactions settled electronically to shoot up with the introduction our national payment switch. honourable prime minister, ladies and gentlemen, i have to reassure you that the bank is very digital minded. the bank was one of the first, along with south africa, in sub -