face high costs for their remittances when using traditional methods based on a structure of correspondent entities. an alternative option that is being used, although because of its nature is not possible to have detailed information, are remittances based on cryptoassets. while these remittances may be faster and even cheaper, they are outside of the regulatory perimeter and thus their customers are exposed to several risks ( counterparty, liquidity, operational ). the cross - border use of cbdc would reap the benefits of crypto - based methods, without their risks. certainly, this would require coordination between the central banks involved. a wholesale cbdc may have several benefits • cross - border use of a cbdc may be explored as a more efficient alternative for remittances • remittances using a structure of correspondent institutions are expensive and usually take time to settle. on the other hand, crypto - based alternative may be more efficient, but they are unregulated and have risks. • the cross - border use of cbdc would reap the benefits of crypto - based methods, without their risks. it certainly would require coordination between the central banks involved. on the other hand, some concerns have still not been fully addressed : a. development and management costs of a cbdc, specially a retail cbdc that is available for a large number of people, can be substantial. technical capacity is still not mature enough, and risks of cyberattacks are exacerbated. b. the level of anonymity that the cbdc should have is still a matter of discussion. in digital networks it can be easy to identify anonymous users due to their links to non - anonymous nodes, such as large companies. the public is already frightened by how much sensitive individual information is stored ( nsa, uber, google, facebook … ), it is possible that a cbdc could create anonymity concerns. page 8 of 11 central bank of chile september 2019 c. some of these concerns end up in a discussion about which is the optimum design features : anonymous or pseudo - anonymous? interest bearing? guaranteed convertibility of bank deposits into cbdcs? d. finally, there are some additional risks to take into account : reputational risk if cbdc is not widely adopted by the public, or if privately issued currencies gain more traction ; financial exclusion of the “ nontech ” persons? even though many cbdc experiences are from developed economies

number of direct and indirect effects on domestic demand, other sectors ’ activity, the labor market, imports of capital goods and the current account deficit. in the medium term, as these projects mature and the full expansion of the capital stock is completed, the level of imports will be reduced, output and exports will rise, and the growth rate of consumption will stabilize together with personal income. the way the current account deficit is being financed is also important to underscore. earlier episodes of balance of payments crises have typically been associated with high debt and liquidity and currency mismatches, which leave economies vulnerable to abrupt deterioration of international financial conditions. in chile, the present current account deficit is being financed mainly by fdi flows, associated with reinvested earnings and new investments, thus providing more strength to the capital account. despite these factors, we need to remain vigilant because an economic scenario like the present one can favor the incubation of future risks. domestically, a scenario of very dynamic final sales and personal income, low unemployment and high utilization of installed capacity, bis central bankers ’ speeches can exacerbate the response of domestic demand and further expand the current account deficit. abroad, the present abundance of international funding as a result of expansionary monetary policies in developed economies may facilitate the financing of the external deficit and push asset prices up, at the expense of incubating vulnerabilities for the future. all this means that we must be particularly alert to prevent financial vulnerabilities from incubating, since these situations can lead to higher leverage of households, firms and financial intermediaries, as well as currency and liquidity mismatches. in this regard, one reassuring element is that in recent months there has been a moderation in household indebtedness, which in any case has remained in line with the income trajectory. it is also important to continue to monitor the evolution of key financial prices and their interaction with lending. this is a task that is not confined only to the central bank, but is for all economic and financial policy makers. beyond these risks, in the scenario we consider today to be the most likely, the chilean economy will expand at a pace that is consistent with its trends. inflation will gradually return to 3 % as specific temporary factors that have influenced recent indicators dissipate. let me describe this scenario and the risks identified in some detail. macroeconomic scenario since the last monetary policy report, the chilean economy has continued to show high