Sweden’s Riksbank is debating whether to become the first significant central bank to issue a digital currency as it responds to an increasing move away from cash in the Scandinavian country. The world’s oldest central bank — it was the first to issue paper banknotes in the 1660s — is launching a project to examine what a central bank-backed digital currency would look like and what challenges it would pose. It hopes to take a decision on whether to start issuing what it calls an ekrona in the next two years. “This is as revolutionary as the paper note 300 years ago. What does it mean for monetary policy and financial stability? How do we design this: a rechargeable card, an app or another way?” Cecilia Skingsley, deputy governor at the Riksbank, told the Financial Times. Central banks around the world have only begun grappling with the potential benefits and challenges arising from digital currencies such as bitcoin in recent speeches from the likes of the Bank of England and the Bank of Canada. But a dramatic drop in Sweden in the use of cash — the amount of notes and coins in circulation has fallen by 40 per cent since 2009 — has forced the Riksbank’s hand.