Central bank accounts for all? – Insights into the Riksbank e-krona project

The Riksbank has provided the general public with money for 350 years, but as the use of cash is continuing to decline in Sweden, we need to think in new ways. In the future, cash may be used to such a limited extent that it is difficult to pay with it. In response to this, the Riksbank started a project in the spring of 2017 to examine the scope for the Riksbank to issue a central bank digital currency (CBDC), a so-called “e-krona”.

An e-krona could ensure that the general public will still have access to a state-guaranteed means of payment. Adopting a position on whether Sweden should introduce an e-krona will take time. But at the same time, the analysis work needs to continue to increase the Riksbank’s knowledge of the consequences of an e-krona and technological solutions need to be developed and tested.

How the e-krona project can move on

Today the Riksbank’s e-krona project is publishing a new report where the project team proposes that the Riksbank:

  • Begin to design a technical solution for an e-krona in order to test which solutions are practicable and possible to realise
  • Draw up proposals for legislative amendments needed to clarify the Riksbank’s mandate and an e-krona’s legal standing
  • Continue investigating the financial aspects of an e-krona

E-krona can be described as Swedish krona that can either be held in an account at the Riksbank (account-based) or be stored locally, for example on a card or in a mobile phone app (value-based). A value-based e-krona is compatible with the Sveriges Riksbank Act, but the project assesses that to issue an account-based e-krona, the act would need to be amended. The Riksbank should therefore begin an investigation that produced concrete proposals regarding what amendments need to be made to the Sveriges Riksbank Act. However, it is up to the legislator to amend the act.

Developing one or more possible technical solutions for an e-krona would provide the Riksbank with greater room for manoeuvre and knowledge prior to a decision on whether or not to issue an e-krona. A preliminary technical solution for the e-krona should focus on a value-based e-krona without interest and with traceable transactions. The Riksbank should also continue investigating an account-based e-krona which would require coordination with other authorities. It is reasonable that a system for an account-based e-krona is built in agreement and perhaps together with other authorities, say the Riksbank’s e-krona project team.

Download the reports here:

The Riksbank’s e‐krona project Report 2

The Riksbank’s e-krona project Report 1

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