conditions – like today ’ s – in which the policy space to buffer the economy from adverse developments is more limited than it was prior to the crisis. and, we are all trying to gain a better understanding of how the longer - term trends i mentioned might affect variables we monitor regularly and seek, to some extent, to control. this being said, it is premature to venture here into debates about the precise scope, direction and timeline of our review, as the matter has not yet been discussed thoroughly by the governing council. what i can confirm, however, is that the strategy review will be guided by two principles : thorough analysis and an open mind. this will require time for reflection and for wide consultation. the parliament, and this committee in particular, have traditionally offered a unique forum for dialogue, which has been enriched by the expert reports prepared ahead of the hearings. 4 the ecb greatly benefitted from these debates 16 years ago when it undertook its last strategy review. this time around, we will be seeking a dialogue which is even more intense and productive than in the past. and i see it as my responsibility, as the ecb president, to report back to you, and engage in further discussion, once the governing council moved forward on the content and timeline of our exercise. the two way street communication principle will apply. shaping the future of money the other topic you have asked me to discuss today is the future of money. indeed, as central banks navigate a complex and changing landscape, we should not only aim to anticipate future trends, but also seek to shape them. in doing so, we should be particularly attentive to risks and perform a thorough analysis of their costs and benefits. the financial services environment is evolving as new entrants shake up the market. so are the public ’ s needs and demands. the ongoing discussion around so - called stablecoins offers a glimpse of the changes that might come. this phenomenon could disrupt the current payments landscape, with spillover effects for monetary policy transmission, financial stability and the international monetary system more 3 / 5 bis central bankers'speeches broadly. but the ecb is not standing still in the face of these challenges. last year, the ecb launched target instant payment settlement ( tips ), an instant payment service that allows money to reach the recipient within seconds, 24 hours a day, 365 days a year. tips responds to the growing user demand for instant payments and helps ensure that any bank account holder in europe can be

in a prudent but sensible manner. once these different streams of work are further advanced, taken together they will form the basis for the committee ’ s assessment of the appropriate level of minimum capital that should be put in place over the long term. but whatever we do – and this gets back to my link between the near and long term – we must not raise global capital requirements in the middle of this crisis. capital buffers are there to be used and we must provide a clear road map where we are headed. liquidity let me now say a few words about our work on liquidity. capital is a necessary condition for banking system soundness but by itself is not sufficient. of equal importance is a strong liquidity base. many banks that had adequate capital levels got into trouble because they did not manage their liquidity in a prudent manner. in response to these shortcomings, the basel committee last september issued its principles of sound liquidity risk management and supervision. this was a significant step toward setting a new global soundness standard for what constitutes robust liquidity risk measurement, management and supervision. but this was only the first step. the next step is to monitor implementation of the principles and we have put in place a process to do just that. we also are developing benchmarks, tools and metrics that supervisors can use to promote more consistent liquidity standards for cross - border banks. better risk management and supervision i have discussed the importance of having stronger global standards for capital and liquidity, but this is not enough. if firms have poor governance and risk management cultures or if supervision is weak, then we could again find ourselves with the types of problems we are now facing. we propose to build on basel ii ’ s supervisory review process – pillar 2 – to raise the bar for risk management and supervision practices. this past january, the basel committee published for comment supplemental pillar 2 guidance. the purpose of this guidance is to address the flaws in risk management practices revealed by the crisis, which in many cases were symptoms of more fundamental shortcomings in governance structures at financial institutions. the committee will strengthen its supervisory guidance and the links to the pillar 2 review process. it is focusing on firm - wide governance and risk management ; capturing the risk of off - balance sheet exposures and securitisation activities ; more effectively managing risk concentrations ; and providing incentives to better manage risk and returns over the longterm, including compensation practices. moreover, we need to move towards a macro