The Central Bank of Sweden is reportedly contemplating adopting a national digital currency as a complementary solution to a sharp decline in the use of physical cash in the country. The proposed e-krona might be launched as soon as just two years from today, according to the FT.
If and when the plan comes to effect it will have historic implications. The institution, Riksbank, is the oldest central bank in the world – established 1668 – and the krona has been the official currency of Sweden since 1873.
“The less those of us living in Sweden use bank notes and coins, the clearer it becomes that the Riksbank needs to investigate whether we should issue electronic money as a complement to the money we have today,” said Riksbank Deputy Governor Cecilia Skingsley.
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“This is as revolutionary as the paper note 300 years ago. What does it mean for monetary policy and financial stability? How do we design this: a rechargeable card, an app or another way?”
While the Riksbank Deputy Governor didn’t commit that the e-krona will be based on blockchain technology, he did confirm that the technology is being considered and seemed to acknowledge that central banks are in danger of losing control if they won’t come up with their own version of bitcoin or another cryptocurrency.
Skingsley said: “We need to do the homework because it’s not an option for the public sector to stay on the sidelines and see the private sector cut off access to central bank money for individuals.”