Sweeden explores moving to a digital currency

Sweden's government will start exploring the feasibility of having the country move to a digital currency, marking another step into the unknown for the world's most cashless society, Report says, citing Bloomberg.

Per Bolund, the financial markets minister, said a review launched on Friday is expected to be completed by the end of November in 2022. Anna Kinberg Batra, a former chairwoman of the Riksbank's finance committee, will lead the inquiry.

Sweden is among the first countries in the world to consider introducing a digital currency. Its central bank is already running a pilot project with Accenture Plc to submit an electronic krona based on the same blockchain technology underpinning digital currencies like Bitcoin.

In October, Governor Stefan Ingves said that any decision on whether to issue an e-krona needs to be taken at the political level.

From the government's point of view, Bolund said that "it's crucial that the digitalized payments market functions safely and that it's available to everybody."

"Depending on how a digital currency is designed and which technologies are used, it can have large consequences for the entire financial system," he said.

In October, the Riksbank estimated that Sweden's cash usage dropped to its lowest level ever, as the pandemic accelerates the shift away from banknotes and coins. According to the bank's research, less than 10% of all payments are made with cash in Sweden.