Sweden’s central bank, the Riksbank, joins major central banks considering adoption of digital currency, in a world rapidly moving to cashless transactions, Bloomberg reported, citing a Swedish government review launched on Friday.
The study launched will assess the feasibility of a potential transition to a digital currency and is expected to be completed by the end of November in 2022.
Commenting on the launch of a formal review, Sweden’s Financial Markets Minister Per Bolund said, “it’s crucial that the digitalized payments market functions safely, and that it’s available to everybody.”
“Depending on how a digital currency is designed and which technologies are used, it can have large consequences for the entire financial system,” he added.
The central bank is already running a pilot project with Accenture Plc to introduce an electronic krona based on the same blockchain technology that underpins digital currencies like Bitcoin, per Bloomberg.
The Riksbank’s Governor Stefan Ingves’ push to fully adopt the e-krona come after the central bank reports that the country’s cash transactions dropped to its lowest level on record amid the COVID-19 pandemic.
In early October, the Bank for International Settlements (BIS) and seven other banks, including the Riksbank, compiled a report actively researching the pros and cons of offering a central bank digital currency (CBDC) to the public. A CBDC is a digital form of fiat money.
Additionally, the International Monetary Fund (IMF) also pushed for the adoption of a CBDC, citing that “CBDCs and GSCs could make cross-border payments less costly and make it easier for households and small firms to have access to financial services.”
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