Sweden’s central bank is planning plans to create a pilot platform for a digital currency known as the e-krona.
While Switzerland took a negative stance towards a central bank digital currency (CBDC) earlier today, with its government claiming that it could do more harm than good, Sweden is starting to explore the potential benefits of e-krona, Reuters reports Dec. 13.
According to the report, Riksbank, Sweden’s central bank, said that it would partner with Irish professional services company Accenture to create a pilot platform for a digital currency dubbed the e-krona.
By initiating the move, the Riksbank aims to bolster its knowledge about the potential of the digital currency as the bank reportedly said:
“The primary objective of the e-krona pilot project is to broaden the bank’s understanding of the technological possibilities for the e-krona.”
As noted in the report, the Riksbank has been looking closely at whether it should issue a digital currency, as the use of cash has declined sharply in Sweden in recent years.
Indeed, the Riksbank appears to have been closely observing the issues surrounding digital currencies so far. In mid-October, the head of Sweden’s Riksbank considered Facebook’s Libra stablecoin project an “incredibly important catalytic event.” Riksbank Governor Stefan Ingves noted that such initiatives trigger the world’s central banks to ready themselves for digital transformation.
The news comes against the backdrop of Switzerland, which is the homeland to the Crypto Valley Association, abruptly shutting down the idea of issuing a digital Swiss franc earlier today. The Federal Council concluded that a CBDC cannot meet expectations for payment efficiency, effective monetary policy, and a more stable financial system.