New Zealand Urged to Adopt Crypto-Friendly Approach Amid Global Digital Asset Boom
Summary:
New Zealand's Ministry has proposed a more pro-active stance towards cryptocurrency, with suggestions to stimulate the digital asset industry. Andrew Bayly, the country's Commerce and Consumer Affairs Minister, called for an overhaul of the current approach, enabling new developments in digital assets and blockchain. His office expressed concern that a 'wait and see' approach might lead to New Zealand missing out on the benefits of the burgeoning industry. These recommendations, including the development of a central bank digital currency (CBDC), display a crypto-friendly outlook, contrasting to the views of the Central Bank governor, Adrian Orr, who considers these developments unstable and critics Bitcoin for not serving as a reliable currency.
New Zealand's government department charged with developing the nation's economic strategy has suggested embracing cryptocurrency innovation more readily. The department released several recommendations aimed at promoting the expansion of digital assets within the state. Andrew Bayly, New Zealand's Commerce and Consumer Affairs Minister, recommended an overhaul of the country's sluggish attitude toward trialing and embracing developments in digital assets and blockchain technology. He entreated the government to facilitate the growth of the crypto sector and contemplate suitable policies to handle associated risks.
In reply to the Finance and Expenditure Committee's queries on cryptocurrencies, Bayly's office argued that the existing 'wait and see' tactic could potentially result in New Zealand missing out on the advantages of advancements in the digital asset sector. The department's consultants set out eight critical suggestions for New Zealand to regain its position in the global crypto surge. The suggestions consist of adopting policies and regulations that stimulate developments in digital assets and blockchain, endorse greater collaboration between government and industry representatives, and immigration to address the skill gaps in the digital assets and blockchain sector.
Other suggestions comprise the development of training and educational resources, tax benefits, Anti-Money Laundering (AML) regulations, and the ongoing design process of a central bank cryptocurrency (CBDC) within the country. This collection of approaches signifies a more crypto-friendly disposition.
Bayly pointed out that most of these recommendations are future-oriented and underscored the requirement for a globally harmonised regulatory approach and supervisory frameworks for digital and crypto assets.
Bayly’s proposal for a domestically generated CBDC contradicts the perspective of the New Zealand Central Bank governor, Adrian Orr. On February 12, Orr informed a parliamentary finance committee that CBDCs, in his opinion, offer no real alternative for physical money and "are not stable." Orr argued that Bitcoin (BTC) neither serves as an exchange medium nor as a value store or a unit of account when he was questioned about the Reserve Bank of New Zealand's (RBNZ) apprehensions concerning cryptocurrencies. He continued:
"In reality, stablecoins, I believe, are the most misrepresented [...] Stablecoins are anything but stable. Their value is only as reliable as the balance sheet of the individual issuing that stablecoin."
"The crucial thiing we can do is be as open and candid as we possibly can. These are speculative coins, not currency and not central bank cash," he finalised.
Published At
4/10/2024 11:40:03 AM
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