The Reserve Bank of New Zealand (RBNZ) recently stated that it will not advocate for a regulation approach to stablecoins and cryptocurrencies but will instead advise heightened vigilance.
Ian Woolford, Director of Money and Cash, RBNZ, stated that issues brought up by crypto-assets and other developments do not cleanly fall inside agency limits. However, concerns like investor and consumer protection, as well as potential market entry restrictions, matter.
The central bank of the island nation reached this decision after collecting 50 submissions from various stakeholders as part of a consultative process that it began in December 2022. Submissions for an Issues Paper on Private Innovation that covered the growth of the crypto-asset sector were sought after.
The submissions “reinforced our view that there are material risks and opportunities, but also material uncertainties about the sector’s future development and the location of the optimal balance,” according to the release. “We share the opinion that caution is necessary. We are not currently considering a regulatory response because of this.
While the possible uses of cryptoassets as money were the proceedings’ main focus, the RBNZ also provided its most recent stance on central bank digital currency (CBDC).
The release stated that although “we are investigating a potential CBDC,” “we have not decided whether one is necessary.” If a CBDC were to be implemented, it wouldn’t replace the cash that would still be accessible.
The release stated that although “we are investigating a potential CBDC,” “we have not decided whether one is necessary.” If a CBDC were to be implemented, it wouldn’t replace the cash that would still be accessible. While Huobi discontinued its derivatives trading services in New Zealand, Binance registered as a financial service provider there.