A New Zealand ministry that focuses on shaping the country’s economic strategy has put forward a proposal to adopt a more accommodating approach towards cryptocurrency innovations. The ministry has made several recommendations to promote the growth of digital assets in the nation.
Andrew Bayly, the Minister of Commerce and Consumer Affairs in New Zealand, has suggested revamping the country’s slow approach to experimenting and adopting innovations in digital assets and blockchain technology. He has urged the government to support the development of the cryptocurrency industry and consider appropriate policies to manage associated risks.
In response to inquiries from the parliamentary Finance and Expenditure Committee regarding cryptocurrencies, Bayly’s office has provided the following statement:
The ministry’s advisors have made eight key recommendations to help New Zealand catch up with the global cryptocurrency trend. These recommendations include implementing policies and regulations to encourage advancements in digital assets and blockchain, fostering greater collaboration between the government and industry players, and facilitating immigration to address skills shortages in the field of digital assets and blockchain.
The list of friendlier approaches to cryptocurrencies also includes developing training and educational resources, offering tax incentives, implementing Anti-Money Laundering provisions, and continuing the design work on a central bank digital currency (CBDC) within the country.
Bayly has noted that most of these recommendations are long-term in nature and has emphasized the importance of a coordinated global regulatory approach and supervisory frameworks for digital and cryptocurrency assets.
However, Bayly’s recommendation for an in-house CBDC contradicts the viewpoint of the Reserve Bank of New Zealand Governor, Adrian Orr. Orr stated during a parliamentary finance committee meeting on February 12th that CBDCs are not a true substitute for fiat money and are not stable. When asked about the Reserve Bank’s concerns about cryptocurrencies, Orr argued that Bitcoin is not a means of exchange, a store of value, or a unit of account. He concluded by stating that “they are speculative coins, not currency and not central bank cash.”
Image: An image depicting Andrew Bayly and Adrian Orr. [Image source: Vimeo]
Orr speaking about stablecoins. Source: Vimeo
Orr’s remarks come as concerns about scams and vulnerabilities in new meme coins continue to rise, with reports indicating that 1 in 6 of these coins are scams, and 91% have vulnerabilities.