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| Sweden begins testing the world's first central bank digital currency |
The Swedish National Bank said on Wednesday that it had started testing e-krona and bringing the country closer to creating the world's first digital currency, the central bank.
The bank said that the Swedish eKron, when finally released, will be used to simulate daily banking activities such as payments, deposits and withdrawals across digital wallets such as mobile applications. "The aim of the project is to demonstrate how the general public can use eKrone," the bank added in a statement.
In January last year, the central banks of the United Kingdom, the euro zone, Japan, Sweden and Switzerland assessed the emission status of central bank digital currencies. The digital currency of the central bank is a traditional currency, but it is issued and managed in digital form by the country's central bank. Instead, cryptocurrencies like Bitcoin are created by solving complex math problems and managing them by different online communities rather than central institutions.
The sharp decline in cash use and competition from other currencies such as Facebook credit prompted central banks around the world to think about spending their own electronic money.
RexBank said on its website that using electronic payments in Swedish krona is "as easy as sending an SMS". Sweden is the least cash-dependent country in the world. This makes it a simple test of how the central bank responds to people with less money.
The Swedish Bank has stated that no final decision has been taken on the issue of the electronic crown and that the current test developed by the consulting firm Accenture will simulate the use of the electronic crown in an "isolated test environment". The bank said that the experience of electronic money that will use blockchain technology will continue until February 2021.