Most People Have Lost Money Owning Swedish Krona

A Response to the Swedish Financial: Supervisory Authority's Article: Most People Have Lost Money Trading Crypto Certificates

All Swedes who have saved in Swedish kronor over the past six years have lost money due to inflation and currency depreciation. This is despite the fact that the economy has generally grown during the same period.

In Sweden, the use of Swedish kronor is the most common way to handle financial transactions and save money. The Swedish krona is a fiat currency not backed by physical assets, but only by trust in the state's stability and creditworthiness.

The majority of the Swedish population has relied on Swedish kronor for their savings and investments between January 2018 and March 2024. All of these have seen their savings decrease in value due to rising inflation. The median investor has lost purchasing power equivalent to about 22.1% due to inflation.

Every single person has lost money holding Swedish kronor

During this period, general inflation in Sweden has increased significantly. Despite this, 100 percent of those who used Swedish kronor for their savings and investments have seen their real values decrease. This shows how difficult it can be to preserve purchasing power with a currency whose value is constantly eroded by inflation. During the same period, savers in Swedish kronor have also lost 25% against the US dollar and 24% against the euro.

Swedish krona is difficult to value

One contributing factor to the difficulty in preserving value in Swedish kronor is that, unlike crypto assets, they are constantly affected by inflation and monetary policy. One explanation for this is that Swedish kronor, like other fiat currencies, lack inherent value in the form of limited supply or independent assets. This makes it particularly difficult for a saver to determine when Swedish kronor are overvalued or undervalued. Instead, there is a risk that a saver will lose purchasing power continuously, which may explain why confidence decreases when inflation rises.

Interest in saving in Swedish kronor seems to have waned

Despite the fact that Swedish kronor is the primary currency in Sweden, interest in saving and investing in kronor has decreased recently. On May 14, the Swedish Tax Agency published a report showing that more and more people are turning to crypto trading in Sweden.

– Despite the fact that Swedish kronor are still widely used in Sweden, we see a trend indicating that interest in saving in Swedish kronor has started to wane recently. In the past two years, investments in cryptocurrencies have increased drastically. According to the report, the number of Swedes trading cryptocurrencies doubled between 2021 and 2022, from 270,000 to 540,000, says Kim, support expert at BTCX.