cross - border payments. 2 / 8 bis central bankers'speeches canadians who have family members in other countries often face high costs and long delays in sending them money. businesses face similar drawbacks in paying for goods and services they purchase from outside canada. these frictions and costs have motivated private digital currencies to aspire to make it easier and cheaper to move funds around. we are all familiar with the explosion of cryptocurrencies over the past few years. bitcoin and similar digital assets were introduced with the hopes of becoming the money of the future. 2 that hasn ’ t happened, nor is it ever likely to. transacting in cryptocurrencies such as bitcoin is just too expensive, and their purchasing power is too unstable. a more recent and potentially impactful innovation is so - called “ stablecoins, ” which are designed to maintain a stable value in terms of a currency or commodity. in most cases, they are backed — either fully or in part — by currency holdings. compared with earlier forms of cryptocurrencies, stablecoins have better prospects for widespread adoption — and, correspondingly, greater potential to further transform the world of money and payments. the most prominent example is libra, a stablecoin that facebook, along with an association of other companies, is planning to launch. libra would run on an existing messaging platform with strong brand recognition. this would give it the potential to reach billions of people — including many with little or no access to banks or financial services. it ’ s tough to predict if libra will ever live up to its promises or even come into existence. but it is a good example of a transformative technology that affects how the bank needs to respond to the future of money. building a modern ecosystem so let me now talk about some key areas where the bank of canada is focusing in order to adapt to this fast - moving world of payments. first, we are working to make sure that canadians who wish to use bank notes can continue to do so. we are working with financial institutions to maintain a state - of - the - art distribution system for cash. this will help ensure that accepting cash remains cost - effective for merchants. some other jurisdictions have adopted more prescriptive approaches, including laws requiring acceptance of cash at the point of sale. these approaches have both costs and benefits that should be further examined. a second area of focus is the bank ’ s support for payments canada

bis central bankers'speeches cash is an old and simple payment technology. it has stood the test of time because it has several important advantages. first and foremost, cash is safe. it is legal tender with a relatively stable value and is widely accepted for payment. it also establishes confidence in the banking system. a bank ’ s customers can be reassured that, any time they want, they can convert their deposits into cash. furthermore, cash is universally accessible. anyone can use it, including people who don ’ t have bank accounts. perhaps not surprisingly, then, cash is very important to those who may face challenges accessing alternative payment methods — such as the homeless and those living in remote communities. cash is resilient — it works even when computer systems go down or during a power failure. it is private — you can buy everyday goods and services without revealing your identity or your personal or financial information. cash also preserves an element of competition in the financial system, by providing a cheap and reliable alternative to credit and debit cards. all this being said, cash also has its limitations. it is more suitable for relatively low - value payments because of the obvious security risks of carrying around large volumes of cash. and it cannot be used to make purchases remotely. with this background in mind, i would like to discuss some issues that canada ’ s payment ecosystem is currently facing. changes and challenges recent advances in technology offer opportunities to improve our core payment infrastructure. we have seen this at the retail level, with contactless “ tap and go ” payments, mobile banking and other innovations. the structure of our economy is also changing, with transactions increasingly taking place online. partly reflecting these innovations, we are seeing a steady decline in the use of cash in retail transactions. in a 2017 bank of canada survey that asked canadians how they pay for goods and services, respondents said that they use cash for about one - third of their transactions — compared with more than half just a decade ago. and about 1 in 10 canadians now claims to be entirely “ cashless. ” 1 in some countries, such as sweden and norway, the use of cash has declined to a level where merchants are finding it too costly to accept cash, and banks are scaling back their processing services. i ’ ll talk later about how we can maintain access to cash, particularly for those “ unbanked ” or “ underbanked ” members of our society. in addition to these trends driven mainly by technology, globalization has put the spotlight on