: the more transparent banks are about their c & e risk profiles and their concrete efforts to align their portfolios with the paris agreement, the easier it is for market participants to compare banks, reward those which are taking the necessary steps to adopt risk management practices aligned with a carbon - neutral economy, and re - evaluate those with misaligned trajectories. transparent disclosures also create a certain level of peer and stakeholder pressure, which is essential to making companies properly manage their risks. investors and asset managers are seeking to develop and market portfolios that are aligned with the sustainability objectives of their own clients. as such, they are becoming increasingly demanding about corporate c & e disclosures. banks ’ own shareholders are becoming increasingly demanding, too, especially concerning banks that have publicly committed to achieving net zero targets. in fact, failure to disclose meaningful follow - up information on their climate commitments has already led to significant litigation and given rise to heightened reputational and legal risks for some banks. recent regulatory and legislative initiatives reflect growing international awareness of the great value of transparent disclosures on c & e risks. in europe, large banks will have to disclose climate - related information under the european banking authority ’ s comprehensive implementing technical standards. they will have to already do so by early 2023, referencing data from the end of 2022. the information requested from banks includes qualitative and quantitative information on environmental, social and governance risks, as well as indicators such as alignment metrics and the green asset ratio – thus significantly raising the bar in terms of c & e risk reporting. in the same vein, sustainability reporting obligations under the european commission ’ s corporate sustainability reporting directive will shortly apply to large corporations, including banks under our direct supervision. main findings of the ecb report on banks ’ progress towards transparently disclosing their c & e risk profile the ecb is also well aware of the importance of transparent disclosures. we published our first stocktake of banks ’ c & e disclosures back in november 2020. we did so precisely to give banks the time and the incentive to improve the quality of their own disclosures in this field. back then, virtually none of the institutions in the scope of the assessment met our expectations as set out in the ecb guide on climate - related and environmental risks, which we published at the same 2 / 4 bis central bankers'speeches time. the second stocktake, published today, shows that the quality of banks ’ disclosures has improved since then

any compensation. there are no insurance schemes. and in several instances, crypto - assets have been shown to offer little protection against it and cyber risks. on the whole, it is difficult to see a justification for the existence of unbacked crypto - assets in the financial landscape. their combined features mean that they are just speculative assets. investors buy them with the sole objective of selling them on at a higher price. in fact, they are a gamble disguised as an investment asset. millions of investors were lured by an illusory narrative of ever - rising crypto - asset prices – a narrative that was fuelled by extensive news reports and investment advice on social media, highlighting past price increases and features such as artificial scarcity to create the fear of missing out. many invested without understanding what they were buying. irrational enthusiasm prospered on self - fulfilling expectations : [ 12 ] the textbook definition of a bubble. like in a ponzi scheme, such dynamics can only continue so long as a growing number of investors believe that prices will continue to increase. until the enthusiasm vanishes and the bubble bursts. the market value of crypto - assets has shrunk from €2. 5 trillion at its peak a year ago to less than €1 trillion today ( chart 1 ). the price of bitcoin [ 13 ] has fallen by more than 70 % from its peak ( chart 3 ). chart 3 price of bitcoin ( eur ) sources : cryptocompare and ecb calculations. stablecoins are exposed to runs the second structural flaw is the purported stability of stablecoins, which the entire crypto ecosystem has relied on to underpin trading in crypto - assets and liquidity provision in defi markets. although stablecoins represent only a small part of the crypto - asset market, [ 15 ] crypto trading using tether, the largest stablecoin, accounts for close to half of all trading on crypto - asset trading platforms ( chart 4 ). chart 4 stablecoin trading volumes and use in crypto trading sources : intotheblock, cryptocompare and ecb calculations. notes : panel a ) : the data are for the period from 1 january 2020 to 29 november 2022. trading volume data are based on cryptocompare ’ s real - time aggregate index methodology ( cccagg ), which aggregates transaction data from more than 250 exchanges. the chart reflects the sum of trading volumes involving