supermarket where prices are denominated in bitcoins? ), and in view of the high volatility we see in its price — it certainly does not retain value. stablecoins, in contrast, could approach the worlds of money and banking. to the extent that the stablecoin is in fact linked to the value of a fiat currency, it can serve as a “ store of value ” like that same currency, and possibly serve as a real means of payment. alongside the features of the stablecoins that i noted, which force us to think of them more as “ money ”, and distinguish them from currencies that are not stable, we also have to pay attention to the challenges that may arise in using those currencies. for example, when stablecoins represent a significant market share of all the assets backing them, the trade in those assets, which is made in order to protect the value of the stablecoin, could impact on the stability of the financial system. to illustrate, the sale of a large quantity of government bonds owned by the issuer of stablecoins who is facing a liquidity crisis as a result of a mass abandonment of the stablecoin, could challenge the stability of the bond market. in this regard, it is worth noting a simple fact : when they are not supervised as required, stablecoins are, in fact, not necessarily stable. only recently, an ostensibly stable currency, tera usd, one of the biggest currencies in terms of the scope of its market value, collapsed and lost its value in several days. given that this occurred, it is good that it occurred at a fairly early stage of development of this world, when it is still worth billions, and not trillions, of dollars, which could have impacted the entire monetary system. therefore, i am of the opinion that we as a central bank have to be charged with the supervision and regulation of stablecoins, to the extent that we will assess that it is required for maintaining economic stability. this is in contrast to currencies that are not stable, where the supervision has to focus on consumer aspects such as transparency, proper management, etc. in recent years an additional, interesting, historic development is starting, which could completely change the rules of the game in the worlds of payments in particular and the financial system in general. i am referring, of course, to central bank digital currencies — cbdc, or what we

to pursue an interest - rate policy consistent with the inflation target of between 1 percent and 3 percent a year, with the intention of reaching the mid - point. the economy does have the problem of poverty, and this should, indeed must, be tackled responsibly by adopting the necessary measures. but it must be tackled with open eyes, with reality constantly in view, and with a commitment to the strategy of long - term growth. without such growth, problems such as poverty cannot be resolved, and it is therefore essential that economic policy be constantly directed towards the achievement and maintenance of growth. as i stated at the outset, the banking system is very important in every economy, and of course israel is no exception. the importance, however, clearly lies in the banking system being healthy, stable and competitive. i have also mentioned the important, even dramatic, development that affected the financial system as a whole, and in particular the banking system - and that is the reform proposed by the bachar committee. i am pleased to see that the banks, or most of them, are already preparing themselves for this, and sales of provident funds and mutual funds are already taking place, and with some measure of success, so it seems to us. when i see this i am happy that the pessimistic scenarios predicted by some are not being realized. in the past, too, such scenarios preceded successful reforms, for instance in the foreign - currency market. it is natural that concern is felt before reforms and changes, but it must be understood that israel's financial system is in need of additional reforms. it is up to the banking system today, and to a great extent also up to the bank of israel, to prepare itself to confront the new targets it faces in a proper manner : at the top of the list i would put basel ii. the bank of israel has placed high on its list of priorities the preparedness of the banking supervision department to adopt the rules of the new basel capital accord ( basel ii ). this also requires the banking system to organize itself accordingly, and that is no small matter. the second target is gearing up to meet the internal audit standards set out in section 404 of the sarbanes - oxley act of 2002 ( " sox 404 " ). this subject is also high on the priorities of the banking supervision department, and of the whole banking system, and will be for the next two years. i have learned from my experience in citigroup