e-Peso and e-Krona: the rise of CBDC*

February 17, 2020
Posted in Blog
February 17, 2020 Inswitch

Sweden is preparing a pilot test to develop the first state cryptocurrency of Europe this year.

For several years now, the Central Bank of Sweden (Riksbank) has been analyzing the pros and cons of launching an electronic currency, aligned with the country’s progressive decrease in the use of cash. For that reason, it has decided to implement a pilot plan to develop the cryptocurrency e-Krona during this year.

The Riksbank argues that this cryptocurrency will allow to offer a secure means of payment as an alternative to the private digital market.

While e-Krona could become the first state cryptocurrency of Europe, it is not the first one in the world. In 2017 the Uruguayan Central Bank, together with the state telecommunications company ANTEL, The Roberto Giori Company and IN Switch -with our  MTS platform-, pioneered the launch of a pilot plan for issuing digital money through the e-Peso mobile application, making Uruguay the first country in the world to issue digital banknotes.

We are most certainly at the beginning of a  larger-scale rise of CBDC (Central Bank Digital Currency).

The 6-month Uruguayan pilot plan included 20 million Uruguayan pesos in digital banknotes. 10,000 users with both Android and iOS smartphones participated in the project, as well as users who did not have smartphones (thanks to USSD technology) by calling to *288#.

Among the advantages offered by the Uruguayan digital currency, it is worth highlighting the traceability of the banknotes, which makes it possible to combat money laundering. Additionally, it allowed for a significant reduction in logistics costs compared to physical banknotes.



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