The Reserve Bank of New Zealand (RBNZ) has initiated a 101-day public consultation period to gather feedback on the principles and design options for the country’s digital currency. However, discussions on the actual issuance of a central bank digital currency (CBDC) will take place in future consultations.
The RBNZ has adopted a four-stage approach to the issuance of a CBDC and aims to introduce an in-house digital currency by 2023. Currently, the central bank is in the second stage, which involves exploring high-level design options for digital currency, as well as consulting and budgeting.
On April 17, the RBNZ released a consultation paper with the aim of determining the viability of digital currency in New Zealand. The consultation period will end on July 26.
The consultation paper promotes the adoption of CBDCs while emphasizing the importance of aligning with other central banks and addressing the decline in cash usage. It poses 12 questions across four main topics: personal opinions on New Zealand’s CBDC, the benefits of digital currency, strategic design, and managed issuance. According to the RBNZ, launching a CBDC alongside a comprehensive supporting infrastructure can drive innovation in the local payments industry.
In addition, the RBNZ is working on alternative formats for the consultation paper, which will be made available in late May.
Meanwhile, Andrew Bayly, the minister of commerce and consumer affairs of New Zealand, has expressed concerns about the country’s slow approach to experimenting with and adopting digital assets and blockchain technology. In response to inquiries from the parliamentary Finance and Expenditure Committee regarding cryptocurrencies, Bayly’s office has outlined eight key recommendations to reinvigorate New Zealand’s involvement in the global crypto wave. These recommendations include adopting policies and regulations to promote the development of digital assets and blockchain, as well as fostering collaboration between the government and industry players.
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