“We agree with the balance of submitters that a regulatory approach isn’t needed right now, but increased vigilance is,” said Ian Woolford, Director of Money and Cash – Tari Moni Whai Take. He was releasing a summary of submissions published today (30 June 2023) for an earlier issues paper “The Future of Money — Private Innovation: Te Moni Anamata — Te Auahatanga”.
“The submissions reinforce our view that there are significant risks and opportunities from stablecoins and other private money innovations, but also significant uncertainties about how the sector will develop and where the optimal balance will lie. We agree that caution is needed, which also reinforces the need for enhanced data and monitoring to build understanding.
“We also agree that global harmonisation is crucial to ensure effective regulation. As overseas regimes are implemented, best practice may become clearer. Implementation of other regulatory regimes, such as the Financial Market Infrastructure Act could also have an impact on the cryptoassets market.
“Issues raised by cryptoassets and other innovations do not fall neatly within agency boundaries. However, issues such as consumer and investor protection or potential commercial or regulatory barriers to entry do matter for the collective vision we have for a reliable and efficient money and payment system that better meets the evolving needs of New Zealanders.
“We will continue to work with other agencies, particularly through the Council of Financial Regulators, to support healthy growth in the financial ecosystem, as well as continuing to engage with industry and other stakeholders on the issues as they arise,” Mr Woolford said.
What are cryptoassets?
A cryptoasset is a digital token that relies on cryptographic methods and non-traditional payment infrastructure to be transacted and stored.
What are stablecoins?
A stablecoin is a type of cryptoasset that aims to stabilise its value relative to other conventional assets, including central bank money.