contact was also made easier by the use of english as the “ lingua franca ” of the global financial system. the resulting trust among those trading made it possible to make fast, sound decisions, leading to commercial success. however, digitalisation could mean that geographical proximity may become less and less important. by fully exploiting the possibilities and potential of current and future information technology, it might be possible in future to overcome distances in space and time almost without any losses in directness and efficiency in the financial markets, too. this creates a totally new opportunity for the geographically fragmented continental market. but – my third step – how to seize those opportunities? 4 many stakeholders will have to join forces in a competitive environment, a leading role as a global financial centre is not set in stone. looking back over the past three centuries, the balance of power has clearly shifted among europe ’ s financial centres. for instance, in the 18th century, it was amsterdam that held the leading position for a long time. as of the 19th century, london began to emerge as a leader 6 / 9 bis central bankers'speeches driven by great britain ’ s position as a colonial power. over the past 60 years, the city of london has continued to cement its dominant position, boosted by stringent us regulatory requirements and tax regulations in the 1950s and 1960s, britain joining the european community in the 1970s, the big bang of the 1980s under margaret thatcher and the controversial “ light touch ” approach adopted by the uk financial services authority around the turn of the millennium. the eurodollar and eurobond markets were born in london, international – especially us – banks relocated, securities trading business expanded and, later, london went on to become a centre for – partly contentious – financial innovations. however, in the period of recovery following the financial crisis, the city of london demonstrated its power of innovation. yet this does not have to spell the end of the story. and brexit is not the only force of change at play. digitalisation has unleashed a period of upheaval that is calling into question the way in which established financial centres usually function. new competitors with innovative technologies and business models are challenging the traditional financial system. digital platforms enable the supply of and demand for financial services to be matched much quicker. the use of digital instruments, such as distributed ledger technology, is changing value chains ; automated securities trading is gaining ground. with old structures becoming less rigid, a new opportunity is opening up for the financial centres on

financial centres, these could also be operators of market and it infrastructures or consultancy firms. one key is to strengthen the links between the finance and it industries – in the same way as has been seen in recent years for fintech. there are numerous challenges to overcome in this context. as profit - driven companies, market participants will naturally have different and, sometimes, clearly opposing individual interests, a varying degree of motivation and a variety of target coordinates. however, it is essential that inner - european competition is not seen as a zero - sum game where the win of one financial centre is a loss for another, but instead that all financial centres develop their potential together with everyone reaping the benefits. 5 conclusion ladies and gentlemen let me conclude : it is clear from this initial outline that the digital city of europe is a very ambitious project. there is – of course – no guarantee for success. but i would like to cite an example from recent financial history which illustrates the power of technology on the financial markets : the “ battle of the bund ". maybe some of you can remember it. at the end of the 1990s, the deutsche 8 / 9 bis central bankers'speeches terminborse – the forerunner for today ’ s eurex – succeeded in beating the london international financial futures and options exchange to win option trading for german bunds, which is still important to this day. years later, an english account of this episode from financial history states “... frankfurt leapfrogged us with better technology ". and it is just this type of “ leapfrogging ” that we need again now, in a team of continental european financial centres, on the digitalisation race track. the effort will be worth it, also from the specific viewpoint of a central banker. our viewpoint is made up of those targets – in addition to that of price stability – that we, along with the other eurosystem central banks, are pursuing, notably safeguarding the stability of the financial system and promoting financial market integration. it is a great deal easier to do so if the majority of european financial market operations take place within our european jurisdiction. yet that doesn ’ t change the fact that open, globe - spanning capital flows and financial markets are still highly desired and necessary. a self - assured digital city of europe project requires the input of many stakeholders, all working together in a new direction. the eurosystem and the bundesbank may not by any means be at the fore but