of forward rates for most of these countries is difficult due to the relative sparseness of the maturity distribution, but for those countries in which five - year forward rates can be computed, they have been declining and have reached very low levels in the past year or so. overall, the combination of lower and less volatile inflation around the world has led to a reduction in inflation expectations and lower perceived inflation risk, and hence to a lower premium in long rates for inflation uncertainty. i believe that these factors have been important contributors to the lower longterm yields and the flattening of yield curves, particularly in emerging markets. the establishment of markets for long - term nominal government and corporate debt in countries in which they did not exist a decade ago is powerful evidence of the faith that investors place in a future environment of price stability. broader economic benefits the economic benefits of price stability are too numerous and well known for me to cover here in detail. long - run price stability certainly is essential for achieving maximum employment. however, i would like to underscore some benefits that are often overlooked, related to the development of markets for long - term bonds. price stability boosts growth by deepening financial markets. given stable prices, savers and investors have more confidence about the ultimate value of their investments. stable prices encourage the growth of financial intermediaries and financial markets. as i have discussed, many emerging markets have recently experienced a deepening of their local financial markets through a greater issuance of longer - dated paper. there is a strong positive link between banking and financial market development and economic growth, and a number of studies have concluded that banking and financial market development is a key driver of economic growth. thus, greater central bank credibility, which permits more development of local financial markets, can have an economic benefit beyond the financial sector. 18 the development of long - term local - currency bond markets may also help to enable governments and firms to plan long - term infrastructure and investment projects that boost economic development. although such debt markets are only one of many factors that can help to lower the costs of long - term planning and enhance the ability to undertake long - term investments, such developments can improve decisionmaking. in particular, investment decisions are less likely to be constrained by having only i have included floating - rate debt in the one - year maturity category. see ross levine ( 2005 ), " finance and growth : theory and evidence, " philippe aghion and steven durlauf, eds., handbook

drawback of intermediation is that you typically must turn over control of your assets, such as savings or stocks, to the intermediary for them to be traded. this creates a classic " principal - agent " problem whereby incentives between the principal - you - and the agent - the intermediary - may not be aligned. that can raise concerns about custody arrangements and recourse to regain control of one's assets. intermediation also requires recordkeeping arrangements that customers can trust accurately reflect their true holdings. in other words, centralized finance requires a substantial amount of trust. with all that in mind, let me turn to how and why technological innovations have given rise to defi. in a capitalist system, the existence of profits provides incentives for others to enter the market, offer a better product, and compete away any excess profits. this can be done by the creation of new financial firms that can provide the same or better service at a lower cost. often that occurs through innovations and exploiting new technologies. think about how the invention of the telegraph and the telephone revolutionized trading. more recently, the advent of the internet further advanced the ease and speed of financial trading. these are examples of how financial trading has evolved over time. and the next wave of innovations in financial market trading could be driven by technological advances that alleviate some potential drawbacks of the centralized approach. often broad technological advances emanate from narrower efforts to design products or processes that solve specific problems. for example, one technology used to support portable home appliances like vacuum cleaners was originally developed to support the space program. 4 similarly, the development of crypto - assets led to the development of technologies that are fueling possibilities in defi. 2 / 5 bis - central bankers'speeches we don't have enough time for me to cover the full history of crypto - assets, but i will focus on several key elements that have affected the evolution toward defi. an early crypto - asset - bitcoin - was developed to function in a world in which trust among individuals did not exist. rather than relying on intermediaries which require trust, bitcoin relied on technology to facilitate trade. bitcoin was also designed for privacy. no one would know who was buying or selling bitcoin. this was achieved through cryptographic technology and private keys. in addition, it allowed individuals to maintain control of their crypto - assets throughout the entire trading process. that is, they no longer