Sweden’s Central Bank is pushing ahead with plans for public, digital currency
Home News , Sweden’s Central Bank is pushing plans for government, digital currency
Marcus Misiak –
The Riksbank, Sweden’s Central Bank has to give a second report to the E-Krona, a digital currencies, the Central Bank (CBDC) eye. It States that the use of cash in Sweden has decreased greatly. The changing financial landscape and the ability to compete against the private payment market, to maintain, to the E-Krona-to a modern crown in electronic Form as a Supplement to the physical money.
According to a survey conducted by the Riksbank only 13 percent of the Swedish population to pay their expenses in cash. In 2010, there were still 39 per cent, which means a decline of 25 percent. A number of banks in Sweden no longer trade with cash. However, there are some groups of people that are skeptical of the development of the e-Krona, because they can adapt to new technologies. This has not slowed down the pressure of the Riksbank, the development of E-Krona further advance but seemingly.
The e-Krona initially used in addition to the cash. The Bank is of the opinion that without accelerated development efforts of private companies may carry too much responsibility in the area of payment traffic, which could lead to problems. In particular, the Swedish would like to avoid Central Bank that private institutions take on the full responsibility to ensure that payments to work in crisis situations. In the report it is stated (freely translated):
In Sweden, the cash consumption continues to decline. In the future, cash may be so marginalized that it is difficult to use as a means of payment. Since 350 years, the Riksbank presents of the Public money available, but the technical development and digitalization of the payment will bring the question of the role of the state. If the marginalisation of cash continues, could ensure a digital crown, an E-crown, that the General Public continues to have access to a strategically guaranteed means of payment. Otherwise, the Public will ultimately be entirely dependent on private payment solutions, can make it more difficult for the Riksbank to promote a safe and efficient payment system, if you are responding to the current developments and the payment of the market fully to private actors.
If the state offers through the Central Bank payment services as an Alternative to the highly concentrated private payment market, this can lead to a decline in competitiveness and a less stable payment system and certain groups, the payment more difficult. Ultimately it can lead also to confidence in the Swedish monetary system fades. Some of these problems could be neutralized through an E-Krona or be mitigated.
Digital currencies of the Central banks (CBDC), however, are still a relatively new and unexplored area, which is currently being analyzed by several Central banks around the world, as it says in the report. The assessment of whether Sweden should introduce an E-Krona, will take some time. In particular are to be clarified in addition to the technical implementation of legal questions to:
The analysis must be continued, so that we can expand our Knowledge about the consequences and impact of an E-Krona. At the same time, technical solutions must be developed so that E-can be developed Krona and tested.
The report proposes that the Riksbank will begin to design a technical solution for an E-Krona, in order to test which solutions are practical and feasible. The E-Krona should be to a modern crown in electronic Form as a Supplement to the physical money.
E-Krona can be referred to as the Swedish crown, which can be attributed either to an account at the Riksbank (accounts-based) or locally stored can be, for example, on a map or in a phone-App (value-oriented). Both types of e-krona assume that a Register is based, so that it is possible to capture transactions and to ensure who is the legitimate owner of the digital crown.
This means, therefore, that digital transactions with e-krona are understandable. The Bank suggests that 2019 will be carried out in a pilot program with full implementation by 2021.
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