1/4  BIS central bankers' speeches  However, they could also reduce the efficiency of the overall financial system if their roll-out leads to a fragmentation of processes, and their interoperability and coexistence with existing systems are not properly organised, or, on the contrary, if they lead to the creation of monopolies. This latter risk stems from the growing interest of global digital giants in digital payment services. Thanks to their huge user bases and expertise in end-toend technology, Bigtechs have the potential to pose a major competitive threat to European payments’ players, who are less experienced in the digital sphere. They could also increase Europe’s reliance on foreign players for payment services, with all the data privacy and sovereignty challenges that this entails. This double-edged impact of innovation on financial system efficiency notably concerns the tokenisation of financial markets and, in general, the use cases of decentralised finance (DeFI). C) Innovation in the financial sector, especially the emergence of Bigtechs and the development of new settlement assets in the form of crypto-assets, raises new challenges for monetary sovereignty and stability. In particular, if stablecoins were rolled out on a massive scale by BigTechs (Facebook’s Diem project), they could be adopted as private settlement assets on a global scale, thanks to significant network effects.
Denis Beau: The digitalisation of the financial sector - new challenges, new levers Closing speech by Mr Denis Beau, First Deputy Governor of the Bank of France, at the 4th Assises des Technologies Financières, 30 September 2021. * * * Ladies and gentlemen, I would first like to thank the President, Eric Woerth, for inviting me to close these 4th Assises des Technologies Financières, and to provide my insight, as a central banker and supervisor, into the challenges posed by the digitalisation of financial services. In the framework of our mission to safeguard monetary and financial stability, the main issue for the Banque de France is how we can facilitate and accompany the digitalisation of the financial sector, which is a source of efficiency gains, while at the same time preserving the stability of our monetary and financial system. In order to present the concrete responses we are trying to bring to this issue, I shall start by reminding you of the new challenges posed by digitalisation to the safety and efficiency of the financial sector, before describing the three main areas where we are working to  respond, in line with our mandate. I. The digitalisation of the financial sector poses new challenges  A) In terms of security, one of the main concerns raised by the current digital transformation of the financial system is IT or cyber-risk. The digital transformation considerably increases financial system participants’ surface area of exposure to cyber-threats, and hence their vulnerability to such risk.