Governments across the world are looking at developing their own digi currencies with Sweden the latest to look towards this sector. Virtual currencies have continued to be the latest trend in world economics with several organizations and governments looking to integrate their potentials.
Sweden have begun testing an e-Krona currency
Sweden has announced that it has begun tests of the e-Krona which is a virtual version of its official currency. The Nordic nation plans to test the virtual currency for a year and would use it in different sectors of the country.
The aim of the virtual currency is to develop the e-Krona to be used for conventional payments of goods and services within the country. Also it would be extended towards other financial activities and would help the government in its race towards developing its own virtual currency via blockchain technology.
The e-Krona would be checked during the testing period for potential problems that could arise before being released to the public for official use.
Why Governments are getting involved in virtual currencies
Several governments across the world have begun the race to develop virtual currencies with Venezuela the first to make an official digi currency called the Petro. China is also testing a virtual Yen as part of its forays towards e-currencies.
It can be puzzling as to why nations are pushing through on plans for virtual currencies when there is an established system of finance. However, the last three decades has since an interconnection of the world economy through the international financial system.
This has been largely due to the sophisticated development of technological solutions and the internet which has made this possible. Despite this immense growth there are still flaws within the international financial system and blockchain has shown the ability to improve the system.
One area that blockchain can help is in the gap between the reach of commercial banks with large sections of the population. This has made huge sections of several countries unbanked due to the lack of presence of banking institutions
Blockchain technology via virtual currencies can solve this as money can be sent via smartphones to users wallets without the need to open a bank account. The speed of transactions in virtual currencies and low commissions also makes it an attractive prospect for governments.
It is because of these challenges that multiple governments across the world are looking to develop their official virtual currencies.