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Norway’s Central Bank said on Thursday it is ready to move ahead and start testing technical solutions for a central bank digital currency (CBDC) over the next two years.
- In an announcement, Norges Bank said the motivation for research into CBDCs remains strong as many other central banks around the world are carrying out similar experiments.
- It has been four years since Norges Bank began researching into CBDCs and the bank believes it is now ready for the next step which involves “technical testing” with more in-depth analysis looking into the implications of launching a CBDC.
- The central bank notes that as payment technologies have evolved at a rapid pace cash payments in Norway are now probably the lowest in the world.
- “Additional knowledge is necessary for us to be able to decide whether issuing a CBDC is appropriate,” said Norges Bank Governor Oystein Olsen.
- The Governor stressed that central bank cash remains important which it plans to retain and develop further by issuing a CBDC.
- No timeline has been revealed for when a CBDC will be launched in Norway, “any introduction of a CBDC will still lie some time in the future,” said the bank in a statement.
- Earlier this month, the Bank of Japan announced plans to begin phase one of experimenting with a CBDC by conducting experiments on the basic functions such as issuance, distribution, and redemption.
- Norway’s neighbor Sweden may have a CBDC within five years, according to Riksbank Governor Stefan Ingves.
- In the meantime, China has been testing platforms on which the digital yuan can be freely traded with other fiat currencies.
