The Reserve Bank of New Zealand (RBNZ) is stepping up its monitoring of cryptocurrencies and stablecoins, the country’s central bank said on June 30.
Ian Woolford, Director of Money and Cash at RBNZ, commented in the statement:
“…a regulatory approach is not necessary at this time, but heightened vigilance is.”
RBNZ’s move is consistent with responses it received from industry stakeholders to the consultation paper published late last year. Ripple, the blockchain-based payment protocol, and Westpac, one of Australia’s four major banks, were among those who submitted responses to the RBNZ’s consultation paper.
Woolford said the comments reinforced the central bank’s view that cryptocurrencies and stablecoins carry “significant risks” and opportunities. He added,
“We agree that caution is warranted, which also reinforces the need for improved data and monitoring to build understanding.”
However, the central bank is taking a wait and see approach when it comes to regulating crypto. Woolford said effective crypto regulation requires “global harmonization.” And as countries around the world introduce regulations, “best practices may become clearer.”
In the meantime, the central bank will continue to work with regulators through the Council of Financial Regulators to support “healthy growth” in the market, Woolford said. He added that RBNZ would also continue to discuss emerging crypto issues with industry stakeholders.
Cryptocurrencies are treated as personal property under current laws in the country and are therefore subject to income tax.
The issues raised by cryptocurrencies “do not fall neatly within the confines of the agencies,” Woolford said. However, issues such as investor protection and regulatory barriers to entry are important to build a “reliable and efficient money and payment system,” he added.
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