the operational resilience of the financial system, and the individual firms and financial market infrastructures within it. i will discuss resilience through a payments lens. the uk ’ s payment systems ( including retail payment systems such as faster payments and bacs, and the high value system – chaps ) connect payment service providers ( psps ) together, as a means of moving money between them. it is therefore vital that the organisations that manage the payment systems dedicate a lot of time to enhancing operational resilience and cyber security. and innovations, including instant payments, will also benefit from a resilient foundation. the bank ’ s operation of rtgs, and more recently chaps, makes a vital contribution to our overarching mission of maintaining monetary and financial stability. chaps is the uk ’ s high value payment system and settles an average of £330 billion each working day, representing 93 % of non - cash payments in the uk by https : / / www. assetnews. com / fintech / europe - trumps - asia - fintech - funding - q2 - 2019 https : / / www. ukfinance. org. uk / sites / default / files / uploads / pdf / uk - finance - uk - payment - markets - report - 2019 - summary. pdf https : / / www. bankofengland. co. uk / - / media / boe / files / speech / 2019 / payments - a - platform - for - innovation - speech - by - victoriacleland. pdf? la = en & hash = 5841227a82f5c75b75ffe32027eef5eda61d2c70 https : / / www. bankofengland. co. uk / report / 2019 / future - of - finance https : / / www. fca. org. uk / publication / research / technology - cyber - resilience - questionnaire - cross - sector - report. pdf https : / / www. bankofengland. co. uk / - / media / boe / files / prudential - regulation / discussion - paper / 2018 / dp118. pdf all speeches are available online at www. bankofengland. co. uk / news / speeches value. rtgs is the infrastructure where the key uk payments systems – including chaps – ultimately settle, supporting stability across the broader financial system. the area of

complete collapse. at this point, another familiar amplifier of financial market stress – contagion – entered the picture. the collapse of terra put a spotlight on the adequacy of the backing of other stablecoins, particularly the adequacy of the real economy reserve assets backing the largest stablecoin, tether, which suffered significant outflows and, on several crypto exchanges, broke its peg to the dollar – meaning many coinholders were not able to redeem at par. a further example is the inherent risk that comes with leverage – a familiar one given its role in many financial crises. leverage is a powerful tool in financial markets, but leveraged positions can greatly amplify losses when asset prices move against investors, driving fire sales of assets and self - reinforcing downward price spirals. in recent years, we have seen the small but growing development of exchanges and other mechanisms in the crypto world, like defi platforms, which have given investors – retail and wholesale – the ability to take very highly leveraged positions. as crypto asset prices began to fall, this has led to large margin calls and automatic liquidation mechanisms – a feature of some protocols designed to protect against risk – that further amplified price falls. we have seen a range of crypto funds taken down by these effects ; one of the biggest has been here in singapore with three arrows capital filing for bankruptcy last week. i could mention other examples – risks that arise from weak governance for example, or the lack of transparency and understanding of investor rights [ 4 ]. but the basic point is the same : new technology does not change old risks. the second lesson i take from the crypto winter is that regulators need to get on with the job of bringing the use of crypto technologies in finance within the regulatory perimeter. or to put it the other way around, the lesson we should not take from this episode is that ‘ crypto ’ is somehow ‘ over ’ and we do not need to be concerned about it anymore. i should note at this point that even with the recent collapse crypto assets and crypto markets have not posed a systemic risk, though i recognise of course that this of is little comfort to those nursing substantial losses. that is not in itself a surprise ; regulators, myself included [ 5 ], made clear, when crypto reached its highs last year, that it was not yet large enough or integrated enough into the rest of the financial system to be an immediate systemic risk