Riksbank announced the successful testing of the digital krone in the Swedish banking system and exploring the possibility of creating payment instruments based on it.
The Swedish central bank has announced that it is going to explore how the digital krona can incentivize payments using smart contracts. The Riksbank posted a report stating that the CBDC trials were successful.
The Riksbank believes that the advantage of the Central Bank’s digital currency is the ability to program or control transfers. For example, initiate a payment when a contract is fulfilled or allocate money for the intended use. The authors of the report note that these possibilities are subject to further study by regulators and experts.
“Concepts such as programmable money, smart money and smart payments are often called the future of finance and this is a good argument in favor of new technology,” the Central Bank said in a report.
Although the final decision on the release of the electronic krona has not yet been made, the next stage of the Central Bank is going to test and study how e-krona can be used to create new payment services and whether they will be more efficient than traditional technologies.
An attempt to integrate existing intermediaries like banks into the Central Bank’s digital currency distribution system among citizens was recognized as successful in the report, as were standalone mobile applications that allow you to store an asset locally on a smartphone.
The authors of the report emphasize that since the pilot version of e-krona allows you to track transactions, this implies the collection of data about the owners, which is contrary to strict privacy laws, such as the EU General Data Protection Regulation (GDPR). Therefore, consultation with both Swedish and European regulators may be required to clarify how a solution based on DLT/blockchain technology relates to the rules for protecting citizens’ personal data.
In 2021, the Riksbank officially extended a pilot project aimed at creating a digital version of the Swedish krona until the first half of 2022.
