In most countries, cash is the primary method of payment in retail shops. However, this is not the same in Sweden as many stores abstain from cash payment methods. The central bank of Sweden, Riksbank, is pushing ahead with plans to use a digital currency for a while now, as it seeks to adjust its increasingly cashless society. Due to the cash crises, the government is currently working plans to launch a new Sweden cryptocurrency known as e-Krona.
As Sweden moves to the cashless economy, the government agents fear that people will turn to private agents; therefore the company is speeding up the launch of eKrona and get an edge in the competition against the market.
Therefore, in due course, the Swedish population will no longer get access to cash issued by central banks. Hence, the resultant payment system would require the implementation of new regulations.
The Riksbank has opted to create its digital currency, known as the e-krona. The bank has planned the e-krona as a digital currency equivalent to the country’s regular currency to bring in use for small transactions between consumers, companies and the authorities.
Moreso, the digital currency will be pegged to the Sweden krona which means that e-krona won’t be its currency but rather a virtual version of the money that already used in Sweden.
Therefore, the Sweden cryptocurrency will function as a compliment to the physical cash first; nonetheless, it will work as an official and only currency after some time if plans from the government happen.
The reason why the Swedish Riksbank bank is working so hard on the project is that the world is moving towards a cash-free society, which is a field that Sweden is also leading in.
However, according to the government, such a society wouldn’t be sustainable if citizens choose to use cryptocurrency issued by private agents, which lack state guarantee.
Therefore, with the launch of the new Sweden cryptocurrency; it looks like the country is trying to move into digital currencies; though it may backfire and leave people who won’t use the digital money in a more troublesome position.
Sweden’s cryptocurrency expectations
Recent years technological developments and the changes we see in the payment patterns of the public are opening up many questions concerning payment in the future and how best to take advantage of modern technology.
Today, cash is used to an ever-decreasing extent in Sweden which has led the central bank to start considering whether a digital complement to cash, i.e., Sweden cryptocurrency is guaranteed by the state so that the bank will be able to promote a safe and efficient payment system in the future too.
As expected, the introduction of the new cryptocurrency “e-krona” will have many implications. For example, the situational demand for the digital cryptocurrency will determine the amount of impact it will have on the Swedish financial sector.
Furthermore, if digital money has no interest, it might have conflicting effects on the growth of the country’s monetary policy. On the other hand, if it has interests, the Riksbank could use it as an instrument for policy-making.
Last year, the Swedish government issued a report that described how the new Sweden cryptocurrency token would look like. Currently, the reports state that the digital currency will launch its pilot scheme anytime this year. The digital currency will be implemented in 2021, although the tests may take more time and pending public approval.
So far, the central bank of Sweden has already developed the underlying infrastructure for e-krona, based on the blockchain technology. In other words, it is worth noting that e-krona is not a cryptocurrency and development for the prototype is currently ongoing.
Therefore, if the pilot tests prove successful; the central bank may soon launch the e-krona for public use; creating a worldwide precedent in the process.
Beware of Scams
Sweden’s reserve bank has warned that firms and individuals who are purporting to sell the electronic version of the Sweden cryptocurrency, the e-krona are fraudsters as the digital currency project has not yet completed. In a press release the bank said, “On certain websites and social media; individuals and firms claims that it is possible to buy e-krona.”
In line with the above; people also contact the Riksbank describing how companies and firms claim to sell e-krona on behalf of Riksbank.
Therefore, the bank urges anyone who receives an offer to buy or who sees this kind of information to contact the bank immediately.
In conclusion, the central bank has a task to promote an efficient and safe payment system. In other words, it has to provide a means of payment which is less difficult for households and companies
Therefore, the central bank needs to consider which role to adopt in an evermore digital space. Hence coming up with a Sweden cryptocurrency can be lucrative.