The Central Bank of Sweden has released a 98-page “economic review” publication, detailing the Bank’s digital currency plans for the country.
To date, it’s the most comprehensive publication about cryptocurrency in the country. The Riksbank, as it’s called, set out plans in the publication, discussing how its e-currency, known as e-krona, will be set up. However, the preamble of the report reveals that the bank intends to concentrate more on central banks’ digital currencies (CBDCs).
More interests on CBDC
The Sweden government has been looking into the process of developing its digital currency. And this economic review channeled solely on CBDC is one of the latest steps taken to achieve the goal of having a Swedish digital currency.
In December last year, Swedish financial authorities revealed plans to test the e-krona digital currency. According to the report, the pilot phase was possible after collaborating with Accenture. The report included references on the bank’s research and documentation about a CBDC. It also detailed the current progress made so far relating to the realization of a Swedish digital currency.
“Riksbank has since continued to delve into various aspects of CBDC, both from an analytical and a practical perspective,” the report revealed.
Major challenges facing digital currency
The report reflected on the challenges facing digital currencies, which include money laundering, cybercrime, and fraud. It stated that the bank could face some difficulties because of these challenges.
The report continued that an open DLT network has several downsides, and every transaction needs to be properly verified by every participant in a resource and time-consuming manner. According to the report, that is the most challenging aspect of floating a digital currency. However, Riksbank has not taken any stance regarding CTF, KYC, and AML. It stated that cyber-attacks and fraud are not easy to prevent in an open network.
Nonetheless, the Swedish government is still planning to float its digital currency despite the challenges facing open networks. The report is one of the latest steps towards the official launch of a CBDC. This review is coming at a time when there is improved interest in CBDC, as several global central banks are underway with their plans to launch their country’s digital currency.
With more and more countries picking an interest, there could be an explosion of digital payment systems soon, with Bitcoin leading the chase. The mainstream financial sector also seems to be growing and navigating towards digital currency.