New Zealand Report Advises Caution on Crypto Regulation

• A report for the New Zealand Parliament has recommended a slow, agile approach to crypto regulation.
• The report takes a favorable view of digital assets and blockchain technology as a whole, while cautioning against excessive restrictions.
• It recommends that regulatory agencies proceed carefully in developing an integrated framework.

New Zealand Parliamentary Report Recommends Slow Crypto Regulation

A report prepared for the Finance and Expenditure Committee of the New Zealand House of Representatives has recommended taking a slow, agile approach to regulating cryptocurrencies. Cowritten by a partner at MinterEllisonRuddWatts and an associate professor from the University of Auckland’s commercial law faculty, the 99-page report considered previously solicited public comments and offered 22 recommendations.

Favorable View on Digital Assets & Blockchain Technology

The report took a favorable view on digital assets and blockchain technology as a whole; however, it cautioned against attempting to create excessive restrictions which could reduce the viability and competitiveness of such businesses. It also suggested that rather than trying to regulate too early, problems should be addressed as they arise instead.

Observation Before Making Local Decisions

The authors further suggested that legislators observe regulatory progress in other countries, such as in the United States, United Kingdom and Australia before making local decisions about regulation. They advised that regulators proceed carefully when designing and implementing an integrated framework due to their limited resources and lack of experience with this new technology.

Unavoidable Regulatory Measures

Though noting the challenges presented by cryptocurrency volatility, environmental impact and criminal usage, some regulatory measures are unavoidable according to the report; it recommends that the government create coherent guidance on how cryptocurrencies should be treated under current law. Furthermore, it suggests introducing consumer protection measures including Know Your Customer (KYC) processes similar to those used in traditional banking systems for customer identification verification purposes.

Conclusion

In conclusion, this New Zealand parliamentary report recommends proceeding cautiously when introducing crypto regulations due to its complexity; however some measures must still be taken in order to ensure consumer protection is maintained within this industry.