. why cigarettes, not milk or fruits? the answer is, it is hard to hold so many fruits in your pocket. also, fruits and milk are not standardized. what happened was that cigarettes emerged as the currency of choice in the camps. but then, many problems came out later. a smoker knows a bad cigarette from a good one. so, he will keep the good cigarettes and trade the bad ones. 1 / 3 bis - central bankers'speeches so, we expect that all these problems will happen as well to virtual currency. there are many competing ones, and even the ones that survive will have problems because of all these issues. the limits of decentralization : when should regulation step in? if the goal is to use them as stablecoins, clearly, that is banking. because then, you are taking money - taking deposits and guaranteeing deposits to support the currency. therefore, you should be treated like a bank and regulated like one. if you are issuing a stablecoin, maybe the requirement should be at least 50 percent of the assets that back it up should be very liquid assets. maybe you should have a reserve requirement. maybe you should have a liquidity coverage ratio, and so on and so forth. therefore, this avoids the very purpose of why these currencies were created to begin with. for them to be useful and safe, they have to be regulated. i think that this is the story of ftx [ failed cryptocurrency exchange ]. encouraging responsible and cautious innovation nonetheless, we should be open to new developments, especially [ in ] a country [ like ours ] that is dependent on remittances. therefore, we have to have an open mind. at the same time, as [ mbm ] eli [ remolona ] said, regulation should be a cautious one. we do not want to regulate without asking what the private players think and the role that they envision for virtual currencies. are they for remittances? are they for speculation? we are clearly, more likely to give [ virtual asset service provider ( vasp ) ] licenses to banks that already exist if, at all, there will be trading ; if they will be allowed to trade in these virtual currencies. by the way, if virtual currencies were to replace gold - if you believe google - the overall supply of gold is us $ 7. 5 trillion globally. if this can displace just

13 percent of gold, then, at the very least, the value of vas is us $ 1. 0 trillion. exactly which va will be worth us $ 1. 0 trillion, we actually do not know. the other question is one of consumer protection - the extent to which the government and the central bank must educate the public and say, " we are allowing this to happen, but these are very risky assets. you should not put in money that you really need for many important things. " ongoing dialogue between regulators and market players in this ese, we would like to be updated on the adoption and usage of vas in the philippines. what exactly is happening on the ground? what are they being used for? to what extent should regulation apply? 2 / 3 bis - central bankers'speeches right now, our view is [ that ] the moment vas meet fiat currency or deposits, clearly, you have to be regulated. exactly what the form of regulation will be is, of course, evolving. our view is one of caution. when did we freeze the issuance of vasps? about six months ago. our view is a cautious one, but regulation should be open to potentially good uses. therefore, if you ban it, then you are not in a position to move in that direction. we hope that we can gain some insights from our speakers. i hope that we can have a fruitful, balanced, and productive discussion ahead. as i already said, the central bank is open to it but very, very cautious. the more we learn, the more we can handle it better. thank you very much, and i hope that it will be a very good afternoon and [ an ] interesting discussion. 3 / 3 bis - central bankers'speeches