Sweden’s Central Bank (Riksbank) announced on Tuesday that it will introduce banks next year to test how its proposed digital currency, e-krona, could handle real-world commercial and retail payments, Reuters reports.
Currently, the Central Bank of Sweden is carrying out a pilot project in partnership with Accenture Plc, which aims to introduce an electronic crown based on the same blockchain technology as that used by other digital currencies, such as Bitcoin, writes agerpres.ro.
Sweden was one of the first countries in the world to consider introducing a digital currency, and it is also the country with the lowest use of cash.
Central banks around the world are looking at the launch of central bank digital currencies (CBDCs) in response to declining cash use and as a way to accelerate domestic and foreign payments.
So far, the e-krona pilot program has only been simulated by Riksbank, but will be expanded in its next phase by including other participants, such as commercial banks. “Technology provides us with new possibilities … but no tests have yet been done on the processing of retail payments at the required security level,” the Riksbank statement said.
The institution said it could not yet confirm which banks or payment service providers would attend the next phase of testing, but the purpose of the operation is to assess how e-krona could be used for both retail and commercial payments. big.
The Central Bank of Japan (BoJ) also began experiments Monday to study the feasibility of issuing its own digital currency, joining the efforts of other central banks that want to benefit from private sector innovation in the field.
The first phase of the experiments, which will be conducted by March 2022, will focus on testing the technical feasibility of issuing, distributing and repurchasing a central bank digital currency (CBDC). We will then move on to the second phase, which will look at more detailed functions, such as setting a CBDC limit that can be held by each entity, the BoJ said in a statement.
If necessary, the Central Bank will launch a pilot program involving payment service providers and end-users. “Although the BoJ’s strategy will not be changed at present and no central bank digital currency will be issued, we believe that initiating experiments at this stage is a necessary step,” said Shinichi Uchida, general manager of the Bank of Japan.
Central banking digital currencies (CBDCs) will allow their holders to make payments online, possibly even offline, competing with current electronic payment methods, such as digital wallets, online banks or cryptocurrencies.