Sweden’s Central Bank Urges Legal Preparations for Digital Krona

Sweden’s central bank is urging lawmakers to prepare a legal framework for a possible digital krona, warning that digital-euro plans and foreign-currency stablecoins could weaken Swedish payments and the krona’s long-term use.

The central bank submitted recommendations to Parliament’s Finance Committee to begin legal preparations for a potential digital currency. It estimates that introducing a digital krona would take at least five years and recommends starting preparations even if Sweden ultimately decides not to issue one.

The bank pointed to the European Central Bank’s digital euro plans and the growing use of stablecoins denominated in foreign currencies. It said those developments could weaken the competitiveness of Sweden’s payment system and put long-term pressure on use of the krona.