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Danmarks Nationalbank rejects the need for a Danish e-krone

Danmarks Nationalbank assesses that there are fewer advantages than disadvantages for introducing a digital e-krone. “Because we have a well-developed financial infrastructure, new initiatives and solutions have to contribute something even better in order to gain market share in Denmark”, says Peter Ejler Storgaard, Head of Financial Stability at Danmarks Nationalbank.

8. Feb 2022
5 min

While Denmark’s neighbouring country Sweden is in the process of a pilot project for a central bank-issued digital currency, and a number of other countries are far along in preparing a similar digital national currency, Danmarks Nationalbank maintains an overall conclusion that a Danish e-krone would not be sensible.

“We are following the developments in central bank-issued digital currencies. A central bank-issued digital currency, which must be able to be used by citizens, raises a number of fundamental questions about the legal, economic and financial consequences, which need to be examined in more detail before issuing one is possible. It is still our assessment that the benefits of citizens getting an account with Danmarks Nationalbank are not commensurate with the costs and risks this will entail.”

This is explained by Peter Ejler Storgaard, Head of Financial Stability at Danmarks Nationalbank.

He refers to a scenario where the introduction of an e-krone means that citizens have to have a deposit account with Danmarks Nationalbank. Another option is a ‘value-based’ central bank-issued digital currency, which does not make citizens customers of the central bank because the digital money is stored locally. The latter model is the one that Sveriges Riksbank finds most realistic.

In an analysis in December 2017, Danmarks Nationalbank reached similar conclusions regarding a possible Danish e-krone.

A secure, efficient and highly digitized system

Here in 2022, Peter Ejler Storgaard repeats Danmarks Nationalbank’s argument that Denmark is a leader when it comes to offering digital payment solutions. Here he mentions instant payments, contactless payments and payments by mobile and mentions that the general population has taken up the new options. He points out that these are payment solutions offered by private banks, and they are secured through the deposit guarantee.

“We have a secure and efficient payment infrastructure. The innovation in the financial sector is already taking place under private auspices and has made great strides in recent years. We do not immediately see that a central bank-issued digital currency in Denmark would strengthen innovation in and of itself”, he says.

Peter Ejler Storgaard says that Danmarks Nationalbank is looking at other central banks’ initiatives ‘with great interest’, but the motivation for developing a central bank-issued digital currency can be very different from country to country.

“The motivation partly depends on the existing financial infrastructure and the citizens’ payment habits and preferences”, he says, noting that in countries where it is not common for citizens to have access to a bank account, a central bank-issued digital currency may be a means to achieve better financial inclusion.

Sweden is at the other end of the spectrum by having a well-developed banking sector just like Denmark.

Sweden also has a very high degree of digitization of payments, and Sweden is also an EU country outside the euro.

Keeping an eye on the euro countries

Vice-President of Finansforbundet Steen Lund Olsen recently called on Danmarks Nationalbank and politicians to be more engaged with a possible introduction of a Danish e-krone.

Steen Lund Olsen emphasised that there are both advantages to a Danish e-krone (combating money laundering and undeclared work as well as savings from phasing out cash) and disadvantages (socially disadvantaged and elderly persons’ lack of familiarity with digital payment solutions and the ability to monitor citizens’ consumption patterns). 

The Vice-President of Finansforbundet called for Denmark to look at the possibilities for a joint Nordic cooperation on an e-currency, which Sweden is well on its way towards. He also called for following the deliberations on a digital euro issued by the European Central Bank. The EU launched a two-year investigation phase in October 2021.

Peter Ejler Storgaard makes sure that Danmarks Nationalbank is keeping an eye on what the euro countries in the EU are considering.

“Denmark has a close relationship with the eurozone in many areas, including the financial sector. That’s why we are naturally following what is going on in the eurozone with great interest when it comes to a central bank-issued digital currency”, says the Head of Financial Stability at Danmarks Nationalbank.

Following the spread of cryptocurrencies

Seven researchers at CBS, including Jan Damsgaard, professor of digitization, and Lars Ohnemus, Head of the Center for Corporate Governance, highlight that a Danish e-krone could be an important financial tool at a time when bitcoin and other cryptocurrencies are gaining ground, and other countries are introducing a national digital currency. The researchers present their appeal in a recent article in Berlingske. They say that the risk of Danish passivity is that monetary policy control will be left to other countries - especially countries abroad.

Peter Ejler Storgaard from Danmarks Nationalbank states that it is difficult to predict how the use of cryptocurrencies will affect the financial system.

“We do not immediately see that a foreign currency, no matter how it may be designed, will be able to gain a significant foothold in the Danish market. We are generally positive about new initiatives to improve Danes’ payment options, provided that they take place under proper, regulated conditions. But because we have a well-developed financial infrastructure, new initiatives and solutions have to contribute something even better in order to gain market share in Denmark. But of course we are following the development closely”, says Peter Ejler Storgaard, noting that the public sector in Denmark continues to use Danish kroner. This means that public salaries, benefits, purchases of services and tax payments will continue to be made in Danish kroner as we know them.


After Nyhedsbrevet Finans’ interview with Peter Ejler Storgaard, the Director of Danmarks Nationalbank, Signe Koustrup, stated in an interview to Børsen that Danmarks Nationalbank was following the development of new technologies and central bank-issued digital currencies (CBDC) closely. Signe Koustrup also rejects the introduction of a digital krone for private individuals, but is positive towards the introduction of a new digital currency that banks can use to settle internal transactions – known as a ‘wholesale’ CBDC.

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