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Why Norway Central Bank is considering on Developing Digital Currency?

Norway’s central bank, Norges Bank, is considering on developing its own digital currency as a supplement of cash to “Ensure confidence in money and the monetary system.”

The report, prepared by a Norges Bank working group, investigates aspects they believe should be considered when assessing the issuance of a Central Bank Digital Currency (CBDC).

Norges Bank Governor Øystein Olsen wrote:

“A decline in cash usage has prompted us to think about whether at some future date a number of new attributes that are important for ensuring an efficient and robust payment system and confidence in the monetary system will be needed.”

Applications of CDBC

The authors emphasize at least three possible CDBC applications: The introduction of a reliable alternative to deposits in private banks, a suitable legal tender as a supplement to cash, and an independent backup solution for electronic payment systems.

“Digital currency represents the future money, banking and finance system.”