Sweden’s central bank prepares for e-krona CBDC
Sweden’s central bank, the Riksbank, is preparing to introduce a possible central bank digital currency (CBDC) — the e-krona — according to a Dec. 15. statement.
The Riksbank said it is “ready to be able to issue an e-krona” if Sweden’s legislative assembly, the Riksdag, chooses to go ahead with the asset’s creation. The central bank said it is “therefore working to prepare for an issuable e-krona.”
The central bank noted that an e-krona could complement cash as transactions become increasingly digital. In addition, a CBDC like the e-krona would reduce dependence on private payment services and match the value of the Swedish krona.
As such, an e-krona would “ensure that we preserve several of the functions of cash in a future where cash is no longer used”, explained the Riksbank.
The Riksbank added that since 2020 it has been working with the consulting company Accenture in a pilot project with an e-krona. The second phase of the pilot project was completed this year. The pilot is now in its third phase, which will continue into 2023.
The Riksbank said that it is investigating how an e-krona can be used on a technical level. Specifically, it considers ways to distribute CBDC to the public and determine which participants can be involved in the access.
The bank is also investigating legal issues related to the e-krona, such as data protection, financial secrecy and asset classification. Furthermore, input has been sought from various sources in 2022 through a dialogue forum and a Request for Information (RFI).
Despite significant progress in the matter, the Riksbank made it clear that Sweden’s legislative assembly, the Riksdag, has not yet decided whether an e-krona should be introduced.
It noted that the government began investigating whether to issue the CBDC in December 2020. The investigation results have been delayed from November 30, 2022 to March 31, 2023.
Today’s news gives little certainty about the Riksbank’s immediate plans, but it strongly suggests that the bank is closer to a working solution than previously known.