Sweden is now charging ahead of many other countries in the race for the creation and development of the national digital currency. The country has now officially begun testing its own Central Bank Digital Currency (CBDC).
According to an official publication from Sweden’s central bank, Riksbank, the production of the E-krona is necessary, to be in line with technological advancements regarding finance, all over the world. The statement says:
“The use of banknotes and coins is declining in society. At the same time, technological advances with regard to electronic money and payment methods are proceeding rapidly. The Riksbank sees potential problems with the marginalization of cash and has therefore initiated a pilot project to help develop a proposal for a technical solution for Swedish kronor in electronic form, an e-krona.”
Furthermore, The Riksbank says that since the use of cash is generally reducing, it might become difficult to properly ensure that payment systems are safe and efficient. This is one of the motivations behind the e-Krona.
The bank, however, says that the e-krona is not a replacement for cash and will only serve as a “digital complement”.
The current pilot project is being done in partnership with multinational digital and professional services company Accenture. For now, the bank has not decided whether it will fully issue the e-Krona.
In October last year, China also announced it was ready to begin a pilot test of its CBDC.
Image Credits: Pixabay