- New Zealand is waiting to see how other countries will regulate crypto
- It ranks 108 out of 146 in grassroots cryptocurrency adoption
The Central Bank of New Zealand will not adopt a regulatory approach despite ramping up its monitoring of cryptocurrency and stablecoins after public submissions, Cointelegraph wrote.
Regulatory approach “not needed”
According to a statement by Ian Woolford of the Reserve Bank of New Zealand, the RBNZ agrees that increased vigilance is what’s needed now, not a regulatory approach. The statement was accompanied by a summary of dozens of stakeholder statements related to an earlier RBNZ paper on DeFi and crypto.
Among the respondents were the Bank of New Zealand, Westpac, Ripple, and New Zealand’s crypto advocacy organization BlockchainNZ.
Significant risks and opportunities
According to Woolford, the statements showed crypto entailed “significant risks and opportunities” as well as ambiguity in terms of market development, and more attention was necessary. He said:
We agree that caution is needed, which also reinforces the need for enhanced data and monitoring to build understanding.
The RBNZ is refraining from action and waiting to see how other countries will regulate crypto. Woolford added that global harmonization was critical to achieve effective regulation and best practices would emerge as regimes are introduced abroad.
NZ ranks low in crypto adoption
Last year, Chainalysis reported that New Zealand ranked 108 out of 146, between Austria and Azerbaijan. The ranking was based on “grassroots cryptocurrency adoption.”
Crypto is a form of property
At the moment, crypto is property under New Zealand’s laws. Various regulations govern digital assets. Some of them are not specific to crypto. Some tax and money laundering regulations find application.
Woolford summed up that crypto assets and other novel instruments raised issues that did not “fall neatly within agency boundaries." If New Zealand wants to create an efficient and reliable financial system, regulatory barriers to entry and consumer and investor protection must be taken into account.
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