in place. the almost unavoidable conclusion, possibly even somewhat prophetic, is that money is liable to become extraneous when participants in an economy have access to historical documentation of all the activities carried out in the past by the other participants. that is, the use of money is not ideal, and more sophisticated “ memory substitutes ” could lead to better economic results. skipping to today, the technological advances, with an emphasis on the worlds of dlt and blockchain, enable us to consider seriously — although we are far from its possible implementation — the idea of a balance, or full “ memory ” of past transactions in digital format. dlt and blockchain make it possible to store vast quantities of knowledge, and to “ remember ” huge numbers of transactions made over time — in digital and secure format. thus they may call into question to some extent the way we think about money, and the government monopoly on owning it, and if we return to narayana, “ the government's monopoly on seignorage might be in some jeopardy as information access and storage costs decline ”. the events of recent days teach us that we are very far from fully adopting the digital system as a “ regular ” product in economics, and we are very far from the day in which money will disappear from our lives, if ever, but there is no doubt that the accelerated technological progress challenges our thinking as economists on many conventions. after this semi - philosophical opening, i want to switch and discuss the active aspect of recent technological changes : the payments market, crypto, smart contracts, virtual currencies, and cbdc. when i arrived at the bank of israel, the state of the payments market in israel was different than it is today. one of my central goals was to develop the payments market in israel and to have it among those of the leading countries. therefore, it was also one of the main anchors in the strategic plan we formulated at the bank when i took on the position. in recent years, we took a series of steps to promote innovation, efficiency, and competition in the payments market for the benefit of the overall population in israel. these steps even helped us to endure the covid - 19 crisis better, as they allowed a rapid and efficient switch to contactless payment, and they will continue to help in developing the economy even long after the crisis. the state of israel is a start - up and fintech nation, and the exhibit outside this room,

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