that have taken place here. if you ’ ve been following our work since the first consultative paper was released in 1999, you know that the proposals have evolved and improved considerably thanks to the industry ’ s honest responses, candour, and letters such as those submitted by the rma. at the committee ’ s meeting, all members acknowledged our responsibility to consider carefully your concerns and those of the broader industry. at the same time, we recognised the need to resolve the open issues and release the new accord as soon as humanly possible so that banks can continue to prepare for the new rules. in a statement to the press after our meeting, the members of the committee noted that we expect to take account of the remaining issues and complete the text of the new accord in the coming months and not later than mid - year 2004. this period of time will also allow us to take better note of domestic consultations underway in some jurisdictions. the comment letters we received covered a wide range of issues. most of the comments focused on credit risk. while this is not a major focus of today ’ s conference, i would like to call your attention to the proposals that the committee has developed to revise the treatment of credit losses. as you know, cp3 calibrated regulatory capital on the basis of both unexpected and a portion of expected credit losses. this was intended as a practical compromise to account for differences in national accounting practices and supervisory authority regarding provisioning. based on views expressed by the rma and other respondents, and in light of our own continued research, the committee now intends to align regulatory capital more closely to economic capital by calibrating it on the basis of unexpected credit losses alone. a supplementary mechanism will help to encourage banks to provide sufficiently for expected credit losses. this proposal can be found on the website of the bank for international settlements, and the committee has invited public comment through the end of this year. motivation behind the committee ’ s proposals beyond the advanced methods proposed for the treatment of credit risk, the inclusion of a capital approach for operational risk represents one the new accord ’ s most notable innovations, to which i ’ ll now turn. in recent years, banks and supervisors have begun to recognise the need to evaluate and seek ways to reduce losses arising from failures in processes, systems, people, or external events. increasingly, supervisors, like many leading institutions, consider the management of operational risk to be a comprehensive practice comparable to that of credit or market risk. while operational risk is

to time. the average fee per transaction in december 2017 was us $ 34. to put the matter into proper perspective, electronic payments, using either balances kept by commercial banks at central banks or retail payments using commercial bank balances, typically take a few seconds and cost a fraction of the transaction fees in bitcoin transfers. store of value : crypto - currencies such as bitcoin have displayed very high volatility in value. crypto - currencies have no intrinsic value and are not backed by any institution or body regarding its value or purchasing power. their price and thus value are determined solely by the supply and demand forces prevailing at the time, which can fluctuate sharply depending on the appetite of the participants. it is true that in some countries, there has been high volatility in the value or purchasing power of their ( b ) money, too. however, one must bear in mind that this kind of volatility normally happens in times of crisis or in jurisdictions that have rather bad macroeconomic, fiscal or monetary discipline. but for bitcoin and most other crypto - currencies, their volatility seems to be structural in nature and the market dynamics that determine their price or value is rather opaque and hard to discern. with such high volatility in value and opaqueness, it poses great risks to the parties in accepting cryptocurrencies as a store of value or means of exchange for goods and services. ( c ) unit of account : with very high volatility and limited use as a means of payment, it is hard to envisage how any society could adopt crypto - currencies as a unit of account. 5. as far as i can see, crypto - currencies are not qualified to become money based on the analysis mentioned above. it is not a question of time that they can become more widely accepted as money. quite the contrary, the design of these crypto - currencies, such as bitcoin, is such that the transaction time and costs would go up if more people use or transfer them. unlike other forms of electronic money using central bank or commercial bank balances, crypto - currencies are not scalable, which undermines its prospect of gaining “ moneyness ” over time. for this reason, i would like to call these “ crypto - currencies ” as crypto - assets for the rest of our discussion as