The Stockholm move comes amid growing concern among governments, central banks, and even intelligence agencies. It is believed that cryptocurrencies can pose a serious threat to traditional global financial institutions and institutions supported by the dollar. The Central Bank of Sweden Riksbank has announced plans to test-launch the electronic crown, the digital currency of the Central Bank.
In a statement this week, Riksbank explained that the goal of the project is to “show how electronic crowns can be used by the general public.” According to bankers, the digital crown should be simple, convenient to use, and also meet the most important safety and performance requirements.
Created by Accenture, an Irish professional services company, the pilot project is expected to run until February 2021. The project will involve test users who are able to make and receive payments using a digital wallet.
In testing, payment options will be used, including an application for mobile phones, smart watches and cards for making payments, deposits and withdrawals. Banks will be able to exchange deposits for electronic krona using a private DLT network controlled directly by the Central Bank.
Sweden is one of the countries that have studied the possibility of using digital currencies with Russia, China, Japan, the European Union, Switzerland, Great Britain, Venezuela, Iran and other countries that are also exploring the idea of electronic currency based on blockchain.
The digital currencies supported by the Central Bank operate somewhat differently from traditional independent or corporate cryptocurrencies such as bitcoin or Facebook cryptocurrency. But the principle underlying national electronic currencies is largely the same, since the system works by solving complex mathematical puzzles and works without using a central server system.
Sweden is one of the most “non-cash societies” in the world, and the country is intentionally moving towards the digitization of all payments.