activities, irrespective of the entity providing such activities, and will thus aim to better achieve level playing fields. continuing collaboration between local and global authorities i would now like to turn to the importance of continued collaboration by regulatory authorities. given the fast pace of change and the global nature of these innovations, collaboration between regulators is important. on 6 may 2010, a ‘ flash crash ’ occurred in the us markets. hft allows firms to submit orders and execute trades ( using algorithms ) and to interact with markets in unpredictable ways, causing price pressure and dislocation of financial markets ( albeit momentarily ). page 7 of 11 at the domestic level, the sarb ’ s involvement in monitoring fintech innovation started in 2013 when it joined an informal intergovernmental working group ( iwg ) in our jurisdiction. this work group was established to better understand virtual currencies such as bitcoin and their regulatory implications. the iwg consisted of national treasury, the financial intelligence centre, the south african revenue services, and the sarb. in 2014, the working group issued a user alert on virtual currencies through national treasury. the sarb in turn, through its national payment system department, furthermore issued a position paper on virtual currencies later that same year. in 2016, the sarb established an internal virtual currencies and dlt working group. in recognising the growing evolution of cryptocurrencies, the sarb tasked this cross - disciplinary working group to research and analyse the evolution of user cases of emerging technologies, including blockchain and dlt. the main objective was to gain a better understanding of underlying dlt and smart contracts that leverage these emerging technologies. further, by focusing on financial services activities, the sarb has accepted that fintech extends beyond virtual currencies and dlt. for this reason, the sarb has recently decided to establish a broader fintech programme, with three dedicated full - time staff members that report directly to me. although it is at an early stage, this programme will be required to strategically review the emergence of fintech and assess the related user cases. the primary responsibilities are expected to include the facilitation of the development of refreshed policy stances for the sarb across the fintech domain. this will be done by robustly analysing both the pros and the cons of emerging fintech innovations as well as the appropriate regulatory responses to these developments. a critical success

factor of the programme will be the ongoing collaboration with our fellow regulators. we thus continue to work closely with national treasury, the financial services board, and the financial intelligence centre in an intergovernmental fintech working group. we will collectively determine the appropriateness of applicable regulatory frameworks and further review how our page 8 of 11 frameworks can strengthen policy goals such as financial inclusion and the deepening of competition. besides collaborating locally, the sarb actively participates in international regulatory and standard - setting bodies. work undertaken by the various working groups at the financial stability board and the bank for international settlements has been proactive in trying to understand the fintech phenomenon and robustly explore its benefits, risks and appropriate regulatory frameworks. the sarb has contributed a paper recently published on assessing dlt and its impact on payments and securities markets. additional work has also been published on the impact of fintech on financial stability. in addition, work continues on matters such as machine learning, artificial intelligence, and digital currencies issued by central banks. the ongoing global collaboration is vital in order to keep pace with these developments. the sarb is committed to staying abreast of and contributing to global thought leadership on fintech. deciding on the appropriateness of structures, such as innovation hubs and sandboxes to keep abreast of fintech developments lastly, i would like to turn to innovation hubs and sandboxes. the sarb has been following the approaches, adopted by other jurisdictions, to assist policymakers and regulators in staying abreast of fintech developments given how some lending and payment platforms have grown to become systemically important systems within a short space of time. for this reason, jurisdictions such as australia, hong kong, singapore and the united kingdom have implemented innovation hubs and regulatory sandboxes. innovation hubs provide support, advice and guidance to firms in navigating the regulatory framework and / or identifying supervisory, policy or legal issues and concerns. regulatory sandboxes provide the platform for live or virtual testing of new products or services, in a controlled environment, with or without any ‘ regulatory relief ’. with added attention to fintech, through the newly established fintech programme within the sarb, we will urgently review the need for and page 9 of 11 appropriateness of innovation hubs and regulatory sandboxes and how to be in a potion to take a firm decision within the coming year in this regard. conclusion in conclusion, i would like to note that