proves unreliable could seriously endanger public trust in the currency and in the central bank. any new payments system technology should be rigorously tested before implementation, with due regulation and oversight thereafter. as to the often stated link between cash and illicit payments, there is no evidence. even the available anecdotal hints attribute only a relatively minor role to illicit activity compared to the overall honest use of cash as a private means of payment. moreover, for all the buzz currently surrounding new payment technologies, it is worth noting that cash, despite having been around for millennia, still remains popular. in the euro area, around 80 % of transactions at point of sale are carried out in cash, and cash transactions account for around half the total value. for now, provision of physical cash remains an important role for central banks. there may be a time in the future when the general public favour electronic money. cash transactions are already a minority in some countries. in that future time, it would be appropriate for central banks to adopt technology that best reflects the general preferences of the population. it is not our role to drive technological adoption in the general public, but to enable changing preferences to be fulfilled in a secure fashion. for that reason we test new technologies in laboratory environments with an array of partners. safeguarding our operations security is the final area i wish to consider today. what steps need to be taken to safeguard our operations from technological risks? banknotes and payment systems are not the only areas where technology creates risk for public trust in the central bank. traditionally we have maintained strong physical security measures to protect our gold and currency reserves. in 1781, the bank of england acquired and subsequently tore down the adjacent church st christopher le stocks, fearing that the spire could be seized by rioters and used as a platform to attack the bank. as a result of technology, potential attacks on central banks extend beyond the physical realm and can be launched from much further away than the building next door. thick walls of a different kind are required to protect our valuable data from technological incursions. recent examples of such incursions include payment systems being accessed and substantial funds being transferred ; suspicions – since proven unfounded – of financial market trades occurring on the basis of hacking the electronic link between the central bank and newswires ; sensitive information being emailed accidentally to outside sources ; and journalists breaking embargo on interest rate decisions. central banks are also vulnerable to more generalised technological risks. there have been a number of recent examples

of computer virus outbreaks that have simultaneously disabled computer networks across a range of institutions in several countries. were such a virus to 5 / 7 bis central bankers'speeches affect the central bank ’ s own network, there would be considerable operational risk. similarly, the smooth functioning of payment systems could be threatened if those servers were affected. faced with this range of threats to our operations, central banks should regularly assess potential risks, and take measures to anticipate them. anti - counterfeiting measures incorporated into our banknotes are designed to foil the most sophisticated counterfeiters. measures put in place to protect our information should likewise aim to foil the most sophisticated assailants. adopting the latest technological advances in security is not only appropriate, but vital. conclusion allow me to conclude. technological change is an integral driver of economic development. it is disruptive at times and impacts not only economies but also our societies. central banks are not isolated from these processes. central banks are well advised to be prudent and forward - looking when approaching the respective challenges – just as they are when implementing monetary policy to honour their mandates. facing the uncertainties of technological change, central banks therefore should 1. adapt policies to take into account technology - driven socio - economic changes, 2. adopt appropriate technology that supports the various functions and tasks of a central banks, and 3. anticipate technological risks to our operations. with these principles in mind, central banks can better manage the challenges stemming from technological change, even when it is disruptive. used appropriately they can even help to improve our operations and efficiency. 1 see, e. g., gordon, r. ( 2016 ), the rise and fall of american growth : the us standard of living since the civil war, princeton university press. it is worth noting that others contest the slowdown, arguing it relates to measurement error, e. g. brynjolfsson, e. and a. mcafee ( 2011 ), race against the machine : how the digital revolution is accelerating innovation, driving productivity, and irreversibly transforming employment and the economy. digital frontier press. 2 see, e. g., evidence presented in constancio, v. ( 2016 ), “ the challenge of low real interest rates for monetary policy ”, lecture at the macroeconomics symposium, utrecht school of economics, 15 june. 3 for a more detailed analysis of issues relating to index calculation, see diewert, w. e. (