They raise new questions about whether the ECB should drive initiatives to integrate retail payments in Europe, and even whether it should issue a digital euro. We have a duty to play an active role in balancing the risks and benefits of innovation in payments, so that money continues to serve Europeans well.
For example, the part of the Basel II capital initiative called Pillar 3 requires banks to release additional information to the public about their risk-taking. Pillar 3 should thus help investors, creditors, and other counterparties better assess banks’ risk profiles. Transparency about risk has become all the more important because modern financial assets increasingly entail greatly different degrees of economic leverage per dollar invested.