Recent experience around the world suggests that the potential of a financial centre cannot be maximized unless it possesses another essential attribute. That other ingredient is stability and it is this aspect that I propose to explore today. Ensuring financial stability is a statutory responsibility of the Central Bank of Malta. The Bank is thus obliged to participate actively in the maintenance of a stable and efficient financial system and to contribute towards its development. This applies not only to the payment and settlement system, of which the Bank is the regulator, but to the entire financial system. The Bank has an on-going role to play in assessing the robustness of the system. It must draw attention to any problems and ensure that these do not in any way impede the functioning of the financial markets as efficient providers of capital for companies and households. The Bank’s approach is therefore to consider the general risks to the system rather than the situation of individual credit and financial institutions. The latter is the task of the Malta Financial Services Authority (MFSA), which has successfully assumed, over the last ten years, full responsibility for the supervision of institutions providing financial services. Why central banks promote financial stability There are several reasons why the maintenance of a healthy financial sector is an essential function of central banks, and this irrespective of their involvement or otherwise in regulation and supervision.
The overall experience has been positive and encouraging. That said, the sandbox is a learning process both for the authorities and the participating firms, and we are constantly working on possible ways to improve its functioning and usefulness for both the authorities and the private sector. In summary, central banks and other authorities have a range of tools and roles to play when facing the challenges posed by the increased digitalisation of the financial sector. I have tried to provide some European experiences from the regulatory angle (MiCA), but also from the perspective of the provision of services (the digital euro project) and from the more informal interaction that innovation hubs and sandboxes allow, with the Spanish sandbox as an example. Carefully choosing and calibrating the right tools is key to making the most of the opportunities that digitalisation offers, while mitigating its risks. Let me stop here, and thank you very much for your attention. 1 43% of respondents ranked privacy as the most important aspect of the digital euro  (well ahead of other features) in order to maintain trust in payments in the digital age. 2 For further details on these decisions and next steps, see "Progress on the  investigation phase of a digital euro", available at https://www.ecb.europa.eu/paym /digital_euro/investigation/governance/shared/files/ecb.degov220929.en.pdf. 3 Caixabank, for peer to peer online payments; Worldline, for peer-to-peer offline  payments; EPI, for point of sale payments initiated by the payer; Nexi, for point of sale payments initiated by the payee; and Amazon, for e-commerce payments.