Sweden’s Central Bank Reopens Digital Krona Debate as Europe Moves Toward a Digital Euro

Sweden’s Riksbank is asking lawmakers to start preparing for a possible digital currency, pointing to progress at the European Central Bank and the rising use of dollar linked stablecoins.

Riksbank Digital Krona Letter to Parliament

In an Oct. 7 letter to the Finance Committee, published Thursday, the Riksbank urged parliament to begin drafting legislation for a potential digital krona. That comes three years after a government inquiry found there was not enough need for one. The central bank wants legal groundwork laid now, even if Sweden eventually decides not to launch a central bank digital currency.

ECB Digital Euro Plans Driving the Change

The letter highlights the ECB’s planned digital euro pilot in 2027 and a possible public launch in 2029. According to the Riksbank, Sweden’s payment system could lose competitiveness if it has no digital version of its own currency to match.

Stablecoin Risks to the Swedish Krona

The bank also flagged foreign currency stablecoins, especially those tied to the US dollar, as a longer term worry, while describing the near term risk as limited. It warned that if such tokens become an attractive way to pay, the krona could come under pressure even inside Sweden. Building a digital krona would take at least five years, not counting the time needed to pass new laws, which is why the Riksbank recommends starting preparations now.