New Zealand’s Crypto FOMO: ‘Wait and See’ Approach

The Ministry of Commerce and Consumer Affairs of New Zealand has proposed a more favorable approach to cryptocurrency innovation. The ministry suggested various recommendations to foster the growth of digital assets in the country. Andrew Bayly, the Minister of Commerce and Consumer Affairs, urged the government to support the development of the crypto industry and implement appropriate policies to manage associated risks. He stated that the current approach of waiting and observing could prevent New Zealand from benefiting from advancements in the digital asset industry. The ministry’s advisers made eight key recommendations, including encouraging the development of digital assets and blockchain, facilitating collaboration between government and industry, and addressing skill shortages through immigration. Other recommendations included providing training resources, tax incentives, Anti-Money Laundering provisions, and exploring the idea of a central bank digital currency. Bayly emphasized the need for a coordinated global regulatory approach for digital assets. Bayly’s recommendation for a central bank digital currency contradicted the views of New Zealand Central Bank governor Adrian Orr, who stated that CBDCs are not a true substitute for fiat money and are not stable. Orr also criticized stablecoins, stating that they are not stable and are only as reliable as the balance sheet behind them. He emphasized that cryptocurrencies are speculative coins and not actual currencies or central bank cash.