Riksbank, which is the central bank of Sweden, has already started to test its own central bank digital currency (CBDC) ever since February, and now would like to host the Bank for International Settlements (BIS) digital currency innovation hub.
The announcement was made on March 6. If Riksbank is sure to host the innovation hub, it should co-finance the event and have it taking place in Sweden. As a result, it has proposed the Sveriges Riksbank Act in which it asks Riksdag, the parliament of Sweden, to approve its financing for international organizations activities.
$3.1 Million per Year if the Hub Is Established in Sweden
A permission for Riksbank to co-finance international organizations activities has been forwarded by Riksbank to the parliament. The cost of this would be 30 million Swedish kronas (about $3.1 million) a year, but only if the BIS decides to have a hub in the country of Sweden. In January 23, the central bank had an amendment referral proposal circulating, proposal that says most of the referral bodies such as stakeholders, organizations and authorities should support or object the proposal.
Other Hub Locations Are in Singapore, Switzerland and Hong Kong
All through 2019, the BIS has played an active role in determining where the BIS Innovation Hub should take place so that central banks from all over the world bolster the financial and global payment system. Some some of the Hubs are located in Singapore, Switzerland and Hong Kong. Switzerland is known for actively performing research on CBDCs and the hub’s distributed ledger technology (DLT). Sweden wants to host the BIS innovation hub seeing the payment services’ digitization has increased in the country.
Riksbank Making Progress When It Comes to Issuing Its Own CBDC
The more the Riksbank is progressing to issue its own CBDC, the more being included in the BIS innovation hub becomes important because it brings an advantage when a comparison between it and some other central banks is being made. The e-krona’s pilot platform started working back in December 2019. For it to run, Riksbank collaborated with the Ireland-based firm Accenture.