Explanation:
Circuit breakers can be used as a macroprudential tool to pause systems, operations, or markets to contain a cyber incident or ICT disruption. The primary challenge is calibrating and defining precise activation criteria. If triggered unnecessarily or inappropriately, circuit breakers can inadvertently cause market panic, liquidity hoarding, or other severe unintended systemic consequences.
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Q.56 In the context of managing cyber and ICT risks in the financial sector, what is the primary challenge associated with the implementation of circuit breakers as a macroprudential tool?
A
Difficulty in integrating circuit breakers with existing financial software and systems.
B
Establishing precise criteria for activation to avoid unintended market consequences.
C
Ensuring that circuit breakers are compliant with international cybersecurity standards.
D
Training financial staff to effectively manage and respond to circuit breaker activations.
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