Sweden is trying to slow down the end of cash

Most countries are desperately trying to get digital-only payments to become a thing, but Sweden has a different problem: it happened far too quickly, and now it's trying to slow the shift down. 

This fascinating story takes a look at what happens when money goes digital too quickly:

Bills and coins represent just 1 percent of the economy, compared with 10 percent in Europe and 8 percent in the United States. About one in 10 consumers paid for something in cash this year, down from 40 percent in 2010. Most merchants in Sweden still accept notes and coins, but their ranks are thinning.

The shift away from physical currency is being driven by adoption of digital wallets and a desire from banks to no longer deal with money. Physical cash is expensive, riddled with risks, and largely an annoyance for banks, some of which need to keep a certain amount on hand to satisfy demand.

There are interesting parallels to where I live, in Amsterdam, The Netherlands, which increasingly is seeing businesses refuse cash and require a particular type of card payment method to shop there at all. I don't really know how many times I've actually used physical money in Europe, unless travelling, which is odd to consider.

Sweden expects to end up cashless by 2025, if not sooner, due to the current rate of change, and it's scrambling to figure out what a 'digital currency' will look like in order to continue the Central Bank's role in the economy. 

Called the 'e-krona,' the country is currently building a simple prototype of what digital currency might look like. The announcement doesn't use the words blockchain anywhere, but it's implied that it would likely be based on at least the core principles while allowing the currency to be administered centrally by the government.

It's fascinating, because it remains largely an experiment with a fixed clock up against the government: can it deliver an alternative to real money before the physical kind goes extinct? And how quickly will the rest of the world follow? Sweden is going to be a petri dish for what happens next in money, but it's not afraid to experiment before another nation decides for them.

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