Sweden is ready to test the e-krona and might be the first European state to issue its digital currency. This was announced by the Riksbank, the Swedish central bank. To be more specific, the Riksbank is conducting a pilot project with Accenture to implement the technical solutions for the development of the state cryptocurrency.
The objective of the Swedish central bank is to make the e-krona complementary to paper money. For this reason, during testing it will be used to make payments, deposits and withdrawals via mobile app, using a digital wallet. Users, from ordinary citizens to banks, will be simulated. The functional side of the e-krona will be based on DLT.
The tests will continue until February 2021, but may also be extended.
However, according to the Central Bank of Sweden, no final decision has yet been taken on the launch of the digital state currency. The test, explains the Riksbank, only serves to gain a better understanding of the use of the digital currency.
Is Sweden’s e-krona ahead of China?
This is still an important announcement, at a time when the central banks of the European Union, the United States and China are all committed in their own way to the creation of their respective digital currencies. While in China the issuance of the CBDC (Central Bank Digital Currency) seems to be determined and close to being realized by 2020, the Fed in the United States has only begun to evaluate the hypothesis of a digital dollar. Meanwhile, the European Central Bank under the management of Christine Lagarde seems to be more open to stablecoins, to the point of wanting to create its own.
In the midst of this, there are several states like Sweden that are conducting their own experiments. It is worth mentioning that Sweden has been a pioneer: well before the advent of Libra, the stablecoin designed by Facebook which shook central banks, the Scandinavian country had already announced the project of a state cryptocurrency that would replicate the currency issued by the central bank. This is hardly surprising considering that Sweden is one of the states where there is very limited use of cash in favour of electronic payments. In other words, the issuance of the e-krona would find a favourable cultural fabric among people who are already accustomed to digital payments.
It remains to be seen how this testing phase will evolve and whether Sweden will actually be able to issue its state cryptocurrency.