and resolution side should, in turn, pave the way for political discussions on a european deposit insurance scheme ( edis ). and they should make this discussion easier, as they significantly reduce the likelihood of edis ever needing to be used. the key contribution of edis is, in fact, that it will instil confidence in the financial system as a whole without probably ever being used7. that is the beauty of such backstops. this, however, only holds if the discussions on edis remain fully incentive - compatible. in other words, edis should in no way water down the standards on mrel and tlac or other risk reduction measures, such as moves to reduce the pile of sour loans and prevent the build - up of 3 / 6 bis central bankers'speeches new ones. but if these conditions are in place, any residual resistance to edis is based on a misunderstanding of its nature as an insurance mechanism. the banking union, and its enhanced regulatory and supervisory framework, has brought about significant progress in reducing overall risk. the common equity tier 1 ratios of significant banks have increased from 9. 7 % in 2008 to over 14 % today. leverage ratios have risen from 3. 7 % to 5. 8 %. and banks have much more stable liquidity and funding. further risk reduction is under way as we speak8. we should not dwell on our achievements, however. the euro area ’ s financial sector remains vulnerable to legacy issues9. moreover, to accelerate further risk - sharing, milestones are necessary to ensure progress in areas of key importance for the optimal functioning of banking union. for example, focused steps need to be taken towards harmonising and improving certain elements of national insolvency frameworks, including the alignment of the conditions under which a bank is deemed to be failing or likely to fail and the conditions for liquidation under the national laws for credit institutions. progress is also necessary on the aforementioned sour loans, or non - performing loans – npls – as we call them, in particular swift implementation of the ecofin action plan. finally, we need to use the single rulebook to further reduce fragmentation, removing opportunities for regulatory arbitrage, harmonising supervisory powers, and making sure that large cross - border investment firms with risks akin to those of credit institutions are supervised like banks at the european level. all of these policy goals are commensurate with a more efficient operation of the ssm. in addition, there remains a need

further discussion, see rogoff, k. ( 2014 ), “ costs and benefits to phasing out paper currency ”, paper presented at the nber macroeconomics annual conference, 11 april. in reality, current private crypto - assets only allow for pseudo - anonymity, as all transactions are publicly recorded. but users do not necessarily have to reveal their true identities. see financial action task force ( 2019 ), “ guidance for a risk - based approach to virtual assets and virtual asset service providers ”, june. the gdpr ( regulation ( eu ) 2016 / 67 ) governs data protection and privacy for all individual citizens of the eu and the european economic area. it was adopted on 14 april 2016 and became enforceable on 25 may 2018. the gdpr also addresses the transfer of personal data outside the eu. one possible implication of this is a race to the top in terms of data protection standards. see cœure, b. ( 2018 ), “ the future of financial market infrastructures : spearheading progress without renouncing safety ”, speech at the central bank payments conference, singapore, 26 june. see cœure, b. ( 2019 ), “ payments for the people ”, introductory remarks at the high - level meeting on financial inclusion, basel, 27 may. see carney, m. ( 2019 ), “ the growing challenges for monetary policy in the current international monetary and financial system ”, speech given at the jackson hole symposium, 23 august. see barontini, c. and holden, h. ( 2019 ), “ proceeding with caution – a survey on central bank digital currency ”, bis papers, no 101, bank for international settlements, january. china sees global leadership in digital payment services as a strategic goal – precisely with the aim of avoiding the future of digital money being dominated by one player in the way that the global monetary and financial system has so far been dominated by one currency. see chorzempa, m. ( 2019 ), “ who likes facebook's libra currency? not the chinese ”, realtime economic issues watch, peterson institute for international economics, 16 july. as the late tommaso padoa - schioppa stressed : “ not surprisingly, the final de - linking from gold shifted monetary management away from international constraints toward domestic priorities. monetary nationalism took over ” ; see padoa - schioppa, t. ( 2010 ), “ the ghost of banco