Sweden’s Riksbank Releases Final Report on CBDC Project
Sweden’s Riksbank has released its final report on its central bank digital currency (CBDC), the e-Krona, which focused on offline payments.
In the fourth phase, Sweden’s Riksbank, said the focus has been on testing and evaluating whether it is possible to design a secure, balance-based offline currency based on the conditions of the e-krona pilot’s test environment.
Findings show that it is possible to develop a secure and usable offline digital currency but with the right boundaries and regulatory framework, concludes Riksbank in its final report. Sweden’s Riksbank noted in its report on the E-krona pilot Phase 4 report released March 2024:
During its research the Riksbank said three different use cases were tested: funding and de-funding e-krona to the payment instrument, offline payment from card to payment terminal (PoS) and offline payment between two cards.
The bank said payments made offline need to be synchronised so that the balance in the offline wallet corresponds to the e-Krona reserved in the shadow wallet in the online system.
Findings did show that depending on the order in which users synchronise payments, problems may arise from lack of liquidity in some shadow wallets.
Central banks around the world are tinkering with their own CBDCs and the race for who will launch a digital currency has a geopolitical component to it.
According to the Riksbank, a CBDC is “an investment” to protect the current fiat monetary system, according to a central banker from Sweden, who also argued that cash will soon be history.
Speakingat theEuropean Central Bank’s (ECB) Forum on Central Banking in Portugal in 2023, Cecilia Skingsley, the former first deputy governor of the Riksbank, said it is necessary for central banks
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