THE SVERIGES RIKSBANK LAUNCHES E-KRONA PILOT PROJECT
As cash usage continues to decline in Sweden, the Riksbank is determined to find a digital solution to complement cash. On 20 Feb 2020, the Riksbank announced that it is conducting a pilot project with Accenture that aims to develop a technical solution for e-krona.
The priorities for the e-krona development include:
- accessibility for general public
- simple, user friendly
- fulfil security and performance requirements
- ability to be held in a digital wallet
- ability to make payments, deposits and withdrawals via a mobile application
The pilot project will run until the February 2021, at which point there will be the option to extend and develop the technical solution.
BLOCKCHAIN EVOLUTION: MOVING INTO THE MAINSTREAM?
According to a 74-page global research report released by JPMorgan on 21 Feb 2020, blockchain technology has moved beyond experimentation and into use in payments, settlement and clearing, and collateral management. Nonetheless, widespread adoption is at least three to five years away.
Key findings from the report are highlighted below:
- There is long-term potential to transform banks’ business models
- Rise of cashless economies will improve global financial inclusion
- Stablecoins have potential to grow substantially in global transactional activity
Several major risks were identified that may hinder or obstruct adoption rates:
- Need for substantial regulatory oversight
- Technical challenges such as cross-platform integrations
- Quantum computing remains a risk for immutability and security
In 2019, JPMorgan became the first national bank to test with clients a digital coin representing fiat currency with the JPM Coin. To read more, please find the full JPMorgan report here.
WHAT ARE THE CRITICAL BUILDING BLOCKS OF VIRTUAL ASSET CUSTODY MODELS?
- Next-generation security and resilience. Design and enhance security operations to provide layered defenses aligned to industry-standard frameworks.
- Comprehensive compliance. Optimize processes through a unified compliance program to comply with existing financial regulations, compliance requirements, and customer commitments.
- Third-party trust. Proactively seek out independent auditors to help prepare for and execute third-party attestation and certification requirements.
- Value-added custody. Launch services that support customers in participating in consensus processes, governance decisions and other rights afforded to virtual asset owners.
Find the full KPMG report here.