As Cash Use Plummets, Swedish Government Begins Testing Cryptocurrencies

Tyler Durden's picture

Authored by Mac Slavo via SHTFplan.com,

Riksbank, Sweden’s central bank, is taking a serious look at Bitcoin. As cash use plummets and the amount of currency in circulation dwindles, central banks are looking to cryptocurrencies as government-backed money.

In Sweden, the number of banknotes and coins in circulation has fallen to its lowest level in three decades.

Riksbank estimates that cash transactions made up only 15 percent of all retail transactions last year. That number is down from 40 percent in 2010, thanks in large part to massively popular mobile payment services. That leaves the bank wondering if a technology similar to that of Bitcoin’s could be implemented in Sweden.

Riksbank isn’t the only central bank taking a serious look at blockchain, the technology that makes Bitcoin and other cryptocurrencies run.

 

These systems, also called distributed ledgers, rely on networks of computers, rather than a central authority like a bank, to verify and record transactions on a shared, virtually incorruptible database.

 

Government bankers across the world believe this has the potential to replace cash and make other payment systems more efficient.

 

– Technology Review

Riksbank is investigating not only distributed-ledger technology (which it describes as unproven yet “progressing incredibly rapidly”) but also traditional, centralized accounting methods for its “e-krona” (pdf) project. Many central banks are looking into this type of currency, but Sweden appears to be at the forefront of the movement.

According to Rod Garratt, an economics professor at the University of California, Santa Barbara, a cryptocurrency that’s available to all consumers “opens up a whole host of issues” and would pose new challenges for makers of monetary policy.

First, there’s the question of who, exactly, should verify the transactions and maintain the distributed ledger. Even if that’s solved, the new system would be, in a sense, too streamlined, making it easier for bank runs to occur in a moment of crisis or panic. In most current financial systems, large-scale withdrawals of funds are naturally slowed by the time it takes for a central bank to produce the paper money people are demanding. But if the currency is purely digital, no such brakes exist—a panicked citizenry could empty their accounts almost instantly, leaving an entire country’s banking system all but penniless.

 

A new journal article (pdf) published by the Bank of International Settlements, a kind of central bank for central banks, suggests a more straightforward approach than trying to use cryptocurrency to replace cash. In the article, Garratt and Morten Bech, a researcher at the BIS, draw an important distinction between a “retail” cryptocurrency like FedCoin and a “wholesale” one that would only be used by banks.

 

Technology Review

China’s central bank has also begun testing of a digital currency. Speeches and research papers from officials at the People’s Bank of China show that the bank’s strategy is to introduce the digital currency alongside China’s renminbi. But there is currently no timetable for this, and the bank seems to be proceeding cautiously.

But the main issue for governments is that they are losing their grip and control on currency. Sweden’s dwindling cash usage is increasing reliance on mobile payment systems risks marginalizing people who don’t use them or can’t access them. Those systems are also run by private companies, which means that commercial forces, rather than government policies, could end up determining how effectively the financial system serves people and the economy.

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
HenryKissingerZuckerberg's picture

isn't crypto too complicated for the rapefugees?

svayambhu108's picture

Plot twist tha aphabet soup owns cryptography and owns cryptocoins

svayambhu108's picture

I am not a mathematical genius but my gut tells me that something that has two type of keys(public/private) is as safe as a TSA lock.

JungleCat's picture

Crypto is not too complicated for the rapefugess if they can spend it using an app on their goverment-provided iPhone.

tmosley's picture

>First, there’s the question of who, exactly, should verify the transactions and maintain the distributed ledger.

If you are asking this question, then you know nothing about cryptocurrencies. 

CH1's picture

What the overlords don't realize is that they'll be teaching millions of people how to use Cryptos, and verifying their value.

Bring it on!

svayambhu108's picture

A few years ago Zimmermann said is no longer unhackable, Zimmermann doesn't have it installed on any device and that speaks volumes

https://motherboard.vice.com/en_us/article/vvbw9a/even-the-inventor-of-p...

JungleCat's picture

Google Alphabet or the alphabet DC agencies?

Never mind, they are one and the same. Silly me, I forgot.

CH1's picture

aphabet soup owns cryptography and owns cryptocoins

LOL... in your dark and precious dreams.

SILVERGEDDON's picture

Whelp, looks like tmosley gonna be a Swiss Miss Crypto Ass Kiss. 

CH1's picture

isn't crypto too complicated for the rapefugees?

It's only too complicated for people who don't want to learn.

Deep In Vocal Euphoria's picture

What a surprise............

 

because that wasn't the plan all along? total control over the money????????

 

noooo, never! The government wouldn't want to control all you filthy fucking sheep's money supply????

 

god damn fucking idiots..every single one of you motherfucking bitcoin sheep. spit in your fucking face and stomp on your fucking rotten remanis..............god damn sheep can't think further than your fucking nose.....................

 

hey I got a bitcoin for you...................this steel bar right in your fucking head...................how's that for a bitcoin for you????? disgusting human

 

you love taking it up the fucking ass disgusting humans...........

 

Bill of Rights's picture

Everything ok ? Or do you need your chew toy..

FreeShitter's picture

21 week emotional one...reading BTC articles gets alot of them triggered.

LadyMarmalade's picture

Pretty sure that his rage is chemically induced because that level is hard for most people to maintain day after day.  My money is on meth, but I've seen some drunk people rant too, so who knows?

toknormal's picture

Ok, lets perform a quick survey of who's "ass" is most exposed here:

• PHYSICAL GOLD: owned and controlled by states, not portable, therefore not tradeable, illiquid in global markets and not going to save your ass in a rainstorm (specially if you need to stuff it up there to get it across borders)

• PAPER GOLD: sponsored by governments, created by central banks, owned by bullion banks and traded by JPM and Goldman Sachs, unlimited in supply

• GUV-SPONSORED CRYTOS: sponsored by governments, created by central banks, owned by states, a blockchain version of fiat currency

• BITCOIN: created by miners, owned by ordinary citizens, traded by holders, globally portable. Unlike precious metals, you can OWN IT, HOLD IT and GLOBALLY FREE TRADE IT

If the Swedish government issue their own crypto, nobody's going to care because nobody's going to value it as a counterparty-free asset. If, on the other hand, they actually use Bitcoin then they're gonna have to buy it in the market, fair & square.

Hobbleknee's picture

Who created bitcoin? Satoshi Nakamoto denied having anything to do with it.

Bitcoin is the NWO's wet dream. Every transaction ever made, recorded in a public record, saved for all eternity.

toknormal's picture

I think you got that wrong. Financial transparency is to the "NWO" as salt water to a crocodile's eyes. Everything they do depends on obfuscation, manipulation, hidden hands and conflagration.

Bitcoin is most definitely not "the NWO's wet dream".

HenryHall's picture

Right now, today, in Puerto Rico only paper money is worth anything. Well maybe gold but you have to trade it for paper money before you can spend it at a supermarket.

Just how will Sweden manage when there is no telecoms, no internet, no ATMs, and not much electricity?

CJgipper's picture

Answer:  they'll get the power back on.

 

Whats the primary mission in Puerto Rico right now?  Power.

Golden Phoenix's picture

The problem is the supermarkets in Puerto Rico don't have anything to buy. When there's nothing to buy cash is worthless. 

The Venezuelans face empty grocery shelves because their cash is shit. Their cash is the cause of their disaster. Many of them are solving the problem by getting bitcoins and ordering supplies they have delivered. 

Don't worry about Sweden in any case. I'm sure the Swedish Bikini Team will still be able to work out trades for whatever they want one way or another.

eftian's picture

They already have total control over the money and create it out of thin air on a computer with no limits whatsoever.

CH1's picture

What a surprise............

Yeah, what a surprise you have no fucking clue what you're talking about.

Some day you might try learning something before posting.

3LockBox's picture

Lies.

As NWO Pushes Cashless Society, Swedish Government Begins Testing Cryptos.

Fixed it.

BigCumulusClouds's picture

You get Post of the Day Award. Congrats.

HalinCA's picture

Great idea - one virius away from an economic collapse when the virus takes down the banking system.  What could go wrong?

buzzsaw99's picture

having something outside their control is those maggots' worst nightmare.

moorewasthebestbond's picture

Bitcoin is the shining beacon of light in Puerto Rico.

 

/s

shinobi-7's picture

Yes sure, just send these morons for a week on holiday to Puerto Rico and see how they survive with their virtual stuff!

CH1's picture

a week on holiday to Puerto Rico

So, you base your life upon a couple of bad weeks in one small part of the globe. Good luck in your fantasy universe. Cause I'm sure - any day now - electricity is going out of style.

And you're betting your entire wealth strategy on it!

nmewn's picture

Its all fun & games until the power go out.

Hey! Here's an idea!

Lets say we have created something out of nothing, thats always an interesting concept. Then we overly complicate it by making the entire process interdependent on luxuries we find all around us in the modern world, like say, i-shit devices, electricity & internet. What could possibly go wrong?!

Ask the people of Puerto Rico & St.Croix what they think of BitShit right now ;-)

cherry picker's picture

I don't know who down voted you, must be some crypto freak.

Anyone who has lived on this planet long enough realizes nothing is 100% perfect and there may be times that much what people take for granted is not available to them.

A couple of years ago I was almost on empty and stopped in a small village for gas.  Signs on the pumps said credit card machine was down, cash only.  Fortunately I had some cash.  Turns out ATMs and debit/credit card machines were down all night for a radius of about 25 miles.

When you carry cash in your wallet, you always have something to buy whatever is necessary to survive for a few days.  BitCoin or plasticv won't do a damn thing for you when the system is down and even pms won't do any good.

People in Puerto Rico are lining up at the few ATMs that are working as they need cash to survive, finding out no one is accepting plastic.

When I owned a bar in Mexico a few years ago, I never accepted plastic and neither did most other restauraunts and bars in the area.  It was all cash and that is also how I paid my vendors and the rent.

nmewn's picture

"I don't know who down voted you, must be some crypto freak."

Well, there's all types so its hard to tell, I've rubbed a few peoples fur the wrong way a few times (lol) and my position on crypto's is known so it could be one of them.

But yeah, we just went through Irma here (not near as bad as the islands but...) and its everything as advertised...you better have cash that you are willing to part with or invest your labor or...you will be at the mercy of whenever .gov gets around to you or the kindness of strangers.

Point being...if crypto's were even a "currency" (besides the earlier false advertisement as them being "money") they would be useful in ALL situations.

Clearly they are not ;-)

Exponere Mendaces's picture

How many gold sellers are there in Puerto Rico, sitting at their folding tables for services and food?

ZERO.

Buh, buh, buh, you guys said that gold is the go-to for when everything hits the fan!

Gosh, what a predicament. You have a real disaster affecting an entire country, and not a single motherfucker is there hawking gold or taking rounds for food and water.

That sound is your precious "phyzz" narrative breaking into little pieces.

LOL

 

Childe of Hale's picture

Who regards electricity as a luxury item ? I guess I need it to keep the Cristal chilled.

BigCumulusClouds's picture

All this makes me think bitcoin was a CIA/M16 creation to get people excited to and used to a digital currency. You have to prime the pump before you can draw water from it. Looks like they are well on their way to getting people comfortable with the implantable chip that Aaron Russo warned us about, and which he learned from a Rockefeller. Sweden was a good choice for the trial balloon since they have no gold mines. Only iron ore.

15horses1donkey's picture

I have an idea, it's old for me, but maybe new for Sweden, and other people interested in blockchain ledgers and their derivatives.

Each skill, trade, and industry has a currency.

When you get paid, just as today, you can choose your superannuation account (or 401k) but in the future you'll also choose the currency you are paid in. You'll qualify to receive them based on skill sets, and based on university education level, or unions or trade groups you are a member of. You can choose a split. And, you can have some paid in an ancient, traditional, nationalistic currency such as the USD or AUD.

All will likely be distributed ledger based systems that are immutable, mostly.

So, sweden creates a digital blockchain based SEK.

Then, they create a department that rigidly structures the educational profiles of all uni student courses and all other technical (or not so technical) educational courses.

Further, they create a set of profiles that allow them to identify the skills used by smart people who can do a job but have no formal or recognized, certified education.

By setting the borders between these skill sets and certifications they divide the population up into 'the shit they actually do, or know'.

Those form the currency groups. You apply for a group, provide evidence, are qualified, and then - you can choose for your wage to be paid in full or in part in that particular crypto.

All such cryptos are open, tradable, floating, and exchangeable. 

From this, I am hoping, supply and demand will result in a real, value-based dynamic system that encourages people to move into industries that produce products and services in need, or in demand.

Government taxes all exchanges, at a low level, eg. 1-2 percent, encouraging exchanges and speculation.

Government also controls the borders, barriers, segmenting, boxing, categorizing, etc of the skills, to be sure that a cleaner who is unskilled has their own appropriate category, as would a company director, or a computer engineer with 3 degrees that has completed over 50 certified subjects. Union members have additional currencies, as do trade groups, etc. It's a currency free for all!  

I imagine the average person after a decade or three of work in a few different industries with expanding education might end up with 50-100 currencies, assuming they always chose an equal split between everything they qualified for.

Enjoy, crypto nerds. :)

 

 

 

 

 

 

 

blargg's picture

Central planners' porn. What's wrong with free market prices encouraging people to enter fields with a lack of supply?

Endgame Napoleon's picture

The problem with that is the deception, mostly put out there by people trying to make a buck off of educational products, targeting fields that supposedly have a shortage of workers. Oftentimes, in the globalist era of computer automation, employers 1) fill those jobs with cheaper, foreign temps; 2) fill those jobs with immigrants or citizens who do not invest in the educational or licensing requirement but who can work for beans due to the per-child-produced welfare and taxfare system; 3) offer mostly temp and part-time gigs due to increased automation of the tasks.

Government and the media, likewise, hype and deceive the job-seeking public on these issues, with elected politicians using alleged job shortages as a way to distract from mass underemployment of citizens. The media just needs something to chat about to generate news. Sometimes, they hype the so-called worker shortages in fields due to the fact that they have not worked in the area, seeing real conditions first-hand in workplace after workplace. Sometimes, they are promoting an economic outlook, propagandistically, to pump up or put down a particular administration. They rarely analyze the job scene with depth or grit; it is a real rarity in the press.

15horses1donkey's picture

Oh, forgot to mention.

In a typical crypto, it has no value. 

In this bizzaro future with tens of thousands of currencies, many nationalistic, but even more global, it's the governments and universities that provide the certifications that allow skilled and able people of high education or no education, to earn coin of some sort. It's the market that sets the value based on aggregated skill demand.

The reserve of any particular currency is a function of the demand and the number of people who can meet the demand. People themselves, when paid, ARE the reserve of the currency. And that reserve changes as new skills and certifications are recognized and old ones are retired.

I can imagine a retired skill, value of the thing plummets. A person holds. Then, after a couple of decades, that skill for whatever reason, is in need again. Perhaps it's creating steel plants, or coal fired power stations, but in a new way, eg. Scrubbers, or with nanotech. Those coins, held, that had no value, appreciate massively, given there are very few people who can do that work, but given that the old retired currency is re-instated and becomes one that a person can qualify to be paid in.

 

 

JailBanksters's picture

Central Banks are only going do something if they can Manipulate it, they're NOT doing it to be in the Favour of the General Public.

I don't know what the angle is, but there has to be one.

SILVERGEDDON's picture

The central banks will never allow a competitor to their game of currency control, lending, and taxation.

Bankers, are the fucking parasites that live off the work of ordinary people.

Until they are all rounded up snd frog marched into the front end of an airport snow blower running at top speed, we will never be free people. 

Crypto is just a cheap shot at creating acceptance for a central bank / FED / government controlled transaction tax based digital currency system at best. 

perkunas's picture

How would any of this end well, A crytpo gov coin, is the oposite of freedom. They can track everything you do, and buy, its a governments wet dream. Being digital you can just add and subtract all the numbers you want, or even cut off your access to them. They are based on nothing, and have no value, the ultimate fiat currency. At least paper has government backing and support crypto is left on its own, to rise and fall 150 percent daily hardly the kind of thing you would want to use in buisness transactions far too unstable.