Traditional money is issued by central banks and commercial banks

In Sweden, money is often synonymous with what you have in your bank account. This money is called commercial bank money and is issued by the bank. In practice, this is a claim on the bank – that is, the bank has a debt to the person holding the money in the account. But there is also money issued by the Riksbank, known as central bank money. The type of central bank money most people are familiar with is banknotes and coins. Another form of central bank money is central bank reserves, meaning money that banks and other financial institutions hold with the Riksbank in accounts in the RIX payment system. They are used by financial institutions when they pay each other.

New technologies have led to initiatives to introduce new forms of digital money, both private and central bank-issued. Central banks are exploring the possibility of issuing central bank digital money to the public, and among the private initiatives, stablecoins in particular have received a lot of attention in recent years.

Euro area is developing central bank digital money for the public

The European Central Bank (ECB) is well advanced in its work to develop a digital euro, which will be a type of digital money issued by the ECB and available to the public – much like a digital version of banknotes and coins.^[23] Read more about the digital euro at Digital euro (ECB), retrieved 19-02-2026. A legislative proposal on a digital euro is also currently being negotiated in the European Council and the European Parliament. Such a legal framework must be in place for the ECB to issue a digital euro. If it is in place, the ECB estimates that a digital euro could be launched and issued in 2029. This work has been accelerated by geopolitical developments and the need for a payment infrastructure that is not dependent on players outside Europe.

Between 2017 and 2023, the Riksbank investigated economic, legal and technical issues related to a digital version of the Swedish krona – an e-krona. In 2023, the government Payment Inquiry, which examined the role of the state in the payment market, concluded that there were not sufficient societal needs for the Riksbank to issue an e-krona.^[24] Betalningsutredningen (Payments Inquiry) (Government, Swedish only). However, the report emphasised that developments are rapid and that economic, political and technological changes may require a reassessment. Since 2023, the Riksbank’s focus has therefore been on analysing and monitoring international work on central bank digital currencies – in particular the digital euro.

The Riksbank considers that the ECB’s rapid potential launch of a digital euro now justifies a discussion of how a digital euro could affect Sweden and what legislative amendments would be needed for the Riksdag to decide that the Riksbank may issue an e-krona. This is important in order not to end up in a situation where the Swedish krona and Sweden risk losing competitiveness against the euro area. You can read more about this in section “Recommendation for Riksdag and Government to set up an inquiry on an e-krona”.

Stablecoins can streamline payments but come with risks

Stablecoins are issued by private entities and are a form of crypto-asset that is meant to hold a stable value, often in relation to a national currency such as the US dollar. Holding stablecoins entails a claim on the issuer, in the same way that bank deposits represent a claim on a bank. For this to work as intended, the issuer needs to have sufficient liquid assets to reimburse the holder when it wants to redeem its claim. Stablecoins have so far had limited practical use outside the crypto world, but interest among market participants in the traditional financial sector has increased recently, thanks to explicit political support in the United States and clearer regulation in many countries, including the EU. Stablecoins do not have a strong competitive advantage in a country that already has a well-developed payment system. But they could potentially be used to make payments between countries cheaper and faster and serve as a means of payment for trading tokenised assets – that is, traditional assets, such as securities, that have been converted so that they can be traded on programmable platforms. You can read more about stablecoins and how they differ from other assets and money in the article Money in transition – traditional and new forms.

But stablecoins can also carry risks, which are discussed in detail in the Riksbank’s Financial Stability Report.^[25] Financial Stability Report 2025:2 (Riksbank). For example, consumer protection is limited. If a company issuing stablecoins goes bankrupt, the consumer’s assets may be fully or partially lost. Holdings of stablecoins are also not covered by the government’s deposit guarantee. If many people want to redeem their stablecoins at the same time, this may force issuers to sell their reserves quickly. This can create fire sales, which in turn can make it difficult for issuers to pay back the face value of stablecoins in bank money. There is also the risk of money being lost in the event of technical failures or operational disruptions, and it is not a given that issuers will take responsibility for losses, for example, in the event of unauthorised access or account hacking.

Some risks are also linked to geopolitical developments. Recently, the European dependence on the US card networks Visa and Mastercard has been widely discussed. A large penetration of, for example, stablecoins controlled by large US actors in Europe and Sweden could become another such dependency in the payment infrastructure.

In extreme cases, a very large use of stablecoins in another currency could also undermine the ability to conduct an independent monetary policy.