Sweden's Central Bank Considers Digital Currency Use

Sweden's central bank is now considering the possibility of issuing its own digital currency, though the exact technology it will use is yet to be determined.

As profiled in The Financial Times today, Riksbank said it is facing pressure to make the switch following a decline in domestic cash use. (According to the report, the amount of notes in circulation has declined 40% since 2009).

Cecilia Skingsley, deputy governor at the Riksbank, said the bank is currently considering the tradeoffs of various technologies. Though she did not mention blockchain specifically, the FT cited the technology as one option the central bank might consider.

Skingsley said:

"We need to do the homework because it’s not an option for the public sector to stay on the sidelines and see the private sector cut off access to central bank money for individuals."

Notably, Skingsley said that the digital currency could be issued alongside banknotes and coins, but that Riksbank would not want to encourage illegal activity through the offering.

Skingsley is expected to expand on the idea in a speech tomorrow.

With the news, Sweden becomes the latest nation to see its central bank consider a digital currency, a process that for most has included at least some exploration of blockchain-based digital currencies.

In recent months, the Bank of England has openly discussed and explored issuing a digital currency using blockchain, while the People's Bank of China is reportedly investigating the idea.

Swedish Krona image via Shutterstock