The testing of the second phase of the electronic krona has been finished by the Central Bank of Sweden


The testing of the second phase of the electronic krona has been finished by the Central Bank of Sweden

The Riksbank is doing research to determine whether or not it is feasible to issue a digital supplement to physical currency in the form of an e-krona. The Riksbank would be the institution responsible for issuing the electronic version of the krona, and it would be made available to anybody and everyone. At yet, no decision has been taken to issue an e-krona.

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The e-krona — state money in digital form

Today, the general public the ekrona has access to the Swedish kronor in the form of currency issued by the state as well as digital money produced by commercial banks. Both types of kronor can be purchased with Swedish kronor. Because people are using cash less frequently, there is a possibility that in the not-too-distant future, o general public will no longer have access to state-issued money or be able to pay with it. Therefore, the Riksbank is looking into the idea of releasing an e-krona.

The Riksbank is of the opinion that the introduction of an electronic version of the krona could help to make the existing payment system more robust. In the event that there is a significant disruption to the systems of the banks or the card companies, it is essential to have access to an alternative means of payment. E-kronas have the potential to perform the same function as cash has done up until this point, which is to offer a state-issued payment option that is accessible to everyone and that supplements the availability of payment services provided by the private sector. 

The Riksbank could give other actors besides banks direct access to a payment infrastructure where they can offer payment services to their customers by providing an e-krona and, consequently, an alternative infrastructure for payments. This would allow other actors to compete with banks for customers. This makes it simpler for smaller and more recently established actors to compete, which is beneficial to innovation.

The e-krona, which is the project name for the Swedish central bank's attempt to create a digital currency that would be used as a CBDC, has successfully completed the second round of its trials. The asset has reportedly reached the point where it can be incorporated into financial networks and used to facilitate transactions, as stated by Riksbank, which is the central bank of the nation.


An investigation was conducted into the CBDC regarding the matter of its technical capability to function within the country's existing digital banking infrastructure. Specifically, the investigation focused on the ability of the CBDC to function within the country's existing digital money transfer systems. Banks such as Handelsbanken and Tietoevry were among those that took part.

According to the research, it was possible to successfully convert e-krona into fiat currency and utilize it in transactions, both online and off. This was demonstrated by the fact that this was possible. During this stage of testing, the project also gained clarity regarding the legal implications of the question of whether or not the e-krona may be considered an "electronic form of cash."

There are still a lot of unanswered uncertainties concerning the future of the currency as Phase 3 of the project gets underway. Riksbank has not yet stated the legal structure upon which the e-krona would be built, nor has it formally confirmed its plan to actually issue the e-krona to the nation's residents. Neither of these things has occurred. However, Riksbank did indicate in January 2021 that the project's proof-of-concept was utilizing Corda, which is a distributed ledger technology developed by R3.

Financial regulators 

Financial regulators all over the world continue to discuss the merits of introducing their own national digital currencies. According to the most current Global CBDC Index from PwC, eighty percent of central banks are either thinking about launching a CBDC or have already started one. According to the research, the "eNaira" of Nigeria is the CBDC that is the most developed at the present time. It was given a score of 95 in the retail category as well as the wholesale category. This year, PwC anticipates an increase in CBDC-related research, testing, and implementation efforts.

The Riksbank, which is Sweden's central bank, has recently stated that it will begin a trial project of its proposed electronic krona that will last for an entire calendar year. The blockchains that are used to manage cryptocurrencies will serve as inspiration for the project's use of distributed ledger technology.

Sweden is moving toward a cashless society, and traditional currency is on its way out of the country. Swish is a mobile payment application that is very universally used, and it has been anticipated that by the year 2023, businesses may no longer take cash payments. The individuals who work at the country's central bank are concerned for two different reasons about this. First, they are concerned that particular populations might be shut out of the payment infrastructure entirely if it were to be handed over to the private sector. Second, consumers may have less faith in the monetary system if they are unable to convert the funds in their commercial bank accounts into a type of "currency" that is backed by the government.

Because of this, the Riksbank started looking into the idea of state-backed digital money a few years ago. Such a currency might perform a function that is analogous to the function that physical cash performs at the present time.