Riksbank completes digital currency payments pilot

E-KRONA: The blockchain-based CBDC solution can be integrated into the existing payments infrastructure

Sweden’s central bank The Riksbank has completed the second phase of its e-krona central bank digital currency (CBDC) pilot and demonstrated that the blockchain-based technical solution it is testing can be integrated into existing banking and payments infrastructure.

“The work has shown how a parallel network with e-kronor, like the tested solution, could be integrated with participants’ internal systems and enable the distribution of, and transactions with, e-kronor,” The Riksbank’s phase two project report says.

“It has also shown how the token-based solution can design wallets similar to a regular account for the end user, but also wallets whose e-kronor in some respects have more cash-like properties.

“By testing the integration of the e-krona network with a POS terminal, it has been demonstrated in practical terms how the network could use existing hardware used in the market today to handle card network payments.

“The work has also highlighted the importance of regulatory framework and cooperation models with the payment market players if an e-krona is to be established in the retail trade.”

Phase three of the project will investigate the ability of the technical solution to offer programmable money and payments, the operation and management of infrastructure, as well as further legal issues, The Riksbank says.

Additionally, it will now focus on the design and function of an e-krona, and is to issue a request for information from market participants wishing to propose potential solutions “in the spring”.

“The e-krona pilot project aims to increase The Riksbank’s knowledge of how an e-krona could be designed and how it would function. No decision has been taken on whether to issue an e-krona or on what technical solution or legal framework it might be based,” the central bank adds.

The Riksbank began testing a digital version of the krona in February 2020 and extended its e-krona pilot to real-world test environments in June 2021.

Riksbank completes digital currency payments pilot was written by Tom Phillips and published by NFCW.