New Zealand's central bank says heightened surveillance, not regulation is the way forward for cryptocurrency.
The Reserve Bank of New Zealand's (RBNZ) strengthened monitoring of cryptocurrency and stablecoin activities in light of recent public interactions does not signal a demand for new regulatory measures. Instead, it suggests the necessity for more vigilance.
On June 30th, the bank's Director of Money and Cash, Ian Woolford, stated that an immediate push for regulatory intervention isn't on the bank's agenda, underscoring the need for ongoing, heightened surveillance.
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The statement coincided with an overview of responses received from various stakeholders to a previous Reserve Bank of New Zealand document on decentralized finance and cryptocurrency.
The responses came from companies and bodies such as BlockchainNZ, a cryptocurrency advocacy organization, tech giant Ripple, and banking institutions, including Westpac and the Bank of New Zealand.
The comments from these organizations pointed out the wide-ranging interests and a mix of cautionary and optimistic views on the emerging field.
We agree that caution is needed, which also reinforces the need for enhanced data and monitoring to build understanding.
The feedback not only illustrated the complexities and opportunities in the field but also highlighted the need for further exploration and understanding. Interestingly, the RBNZ seems to bid its time, looking at how other global players navigate cryptocurrency regulations before deciding its course of action.
Currently, cryptocurrency is viewed as a property type under New Zealand law. The legislation does not specifically cater to digital assets. Instead, they come under the umbrella of general financial, anti-money laundering, and tax regulations.
He went on to highlight the importance of consumer and investor protection, as well as the significance of regulatory barriers to entry in fostering a dependable and efficient monetary and payment system.
While the Reserve Bank of New Zealand recognizes the potential of cryptocurrency, it prioritizes monitoring over immediate regulation. As the story concludes, it leaves us contemplating the balance between embracing innovation and maintaining a cautious approach to digital assets.
