Sweden is not that cold anymore, as it used to be when the climate wasn't changed yet, and it seems to not be cash user friendly any longer, for years now. The talks around Sweden dumping cash for a cashless society have been around for many years and they seem to become a reality sooner than later, thanks to the Central Bank latest initiative.
Riksbank, Sweden's Central Bank has just announced that it's going to test a new digital currency, which is to be called the E-Krona, for one year till February 2021. The new digital currency will work on Distributed Ledger Technology and will be available only "in an isolated test environment". What's the aim of the test and how do the Swedish see such a currency?
“The aim of the project is to show how an e-krona could be used by the general public. A digital krona should be simple, user-friendly as well as fulfill critical requirements for security and performance.”
The E-Krona won't be issued to the general public, for the moment being just a pilot test, but in the case of the ones already using Swish, Sweden's mobile payment service, or in the case of the crypto holders, dealing with such a krona won't be a difficult task or anything of the future.
"In the test environment, simulated users shall be able to hold e-kronor in a digital wallet, make payments, deposits and withdrawals via a mobile app. The user shall also be able to make payments via wearables, such as smart watches, and cards"
according to Riskbank
The demand for cash has decreased dramatically over time, with a fall from 40% of the population using cash for general purchases in 2020, to nearly 13% in 2018, which explains clearly the direction of Sweden towards a cashless society. According to the Central Bank, as long as there will be a demand for cash they will print paper kronas, and the digital one isn't seen yet as a replacement.
I personally doubt that in ten years from now we will still have anything paper made, and the trend towards a cashless society is clear. Trees will survive after all. How much privacy we will still have when everything will be doable through wearables and smartphones, and even a RFID chip hand implanted might become a reality, is hard to predict, but knowing how much privacy gadgets nowadays offer to their users, you can see where I point at.
The takeaway for this news is that Sweden might be the first European country to become a cashless society, and most probably Distributed Ledger Technology will come at hand to make it a reality, and all of this will have its pros and cons of course, as anything in life has. We'll see how the test worked though, on February 2021, when it will be completed.
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Thanks for attention,