Central bank digital currencies [CBDC] have started to take the world by storm. Sweden was seen trying to catch up to China in the development of the CBDC with its latest announcement.
As countries across the globe have just started to explore the prospects of launching a CBDC, China is already at the testing phase of the digital yuan. While Japan is working on Phase 1 of its CBDC pilot, Sweden announced that it had concluded the first phase of its CBDC pilot program. However, this pilot reportedly gave rise to a number of issues that had to be addressed by the country’s central bank.
Sweden Completes Phase One Of CBDC Development
The central bank of Sweden, Sveriges Riksbank released a recent report revealing the results of Phase one of the CBDC pilot conducted by the bank. While the e-krona proved to be competent in various aspects, certain things like the purchase of coffee by Stockholmers with the e-Korna had to be looked into by the bank.
The report further read,
“The solution tested in phase one of the e-krona pilot has met the performance requirements made in the public procurement. But this has taken place in a limited test environment and the new technology’s capacity to manage retail payments on a large scale needs to be investigated and tested further.”
With scalability as a major issue, the e-krona still needed some work. Additionally, issues pertaining to privacy were also noted in the e-krona. While the second phase of the Sweden digital currency is said to address all these issues, it would also focus on aspects such as retail payments and storage systems.
Addressing the privacy feature, the bank stated,
“The Riksbank is currently analyzing to what extent the information stored in the transaction history can be regarded as information covered by banking secrecy and whether it comprises personal data.”