The oldest central bank in the world to expand the digital currency project by 2022

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The Swedish bank Riksbank is expected to expand the digital currency central bank pilot project by one year. According to the bank, this helps professional services companies to consult more comprehensively and ensures the digital currency is properly deployed.

More Creativity Against Digital Krona

This evolution was announced by Riksbank in a press release on Friday, 12 February 2021. The digital Krona project will run until February 2022, according to the bank. Riksbank also announced that, as a complement to currency, it will continue working on an alternative technological solution for the digital Krona.

This will lead, according to the bank, to an improvement in its awareness of the technology that drives the digital currency. The financial institution will also continue to develop other products focused on enhancing the efficiency and scalability of its digital currency platform.

There are also plans to expand testing to offline roles and to monitor test outcomes for external participants. Recently, the world’s oldest bank indicated that the proposed e-krona should be open-based and not privacy-featured. Since a remote ledger is included in all CBDC transfers, no CBDC can be truly peer-to-peer, offline and anonymous like cash.

Concerns about Digital Krona remain

Some questions within the Swedish financial sector have been posed in recent months by the growth of the digital Krona. The feasibility of a national digital currency and its impact on the current banking system have been challenged by some industry experts.

In recent months, the lack of clarification over the issuance of the e-krona has also caused problems. For some time, Sweden’s central bank has been researching CBDCs and has performed important tests going back more than a year. Despite intense pressure from the central bank in 2020, the Swedish government has yet to make a major legislative move toward creating a digital currency.

Following the impact of the coronavirus pandemic, however, there may be a shift in sight. As more firms move online in the midst of the new movement constraints, there has been a decrease in the amount of conventional cash in circulation.

It is known that a drive to create a digital currency as a possible solution is being contemplated by the Swedish government. Nevertheless, concerns about the nature of the e-krona and the technologies that will be deployed with it remain.

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