New Zealand’s Financial Markets Authority (FMA) is seeking feedback on a proposed regulatory approach for certain New Zealand dollar referenced and backed stablecoins that are designed to be used for payments rather than investment.
Under the proposal, qualifying stablecoins would no longer be treated as financial products under the Financial Markets Conduct Act, provided they meet specific requirements and safeguards.
FMA General Counsel Liam Mason said the FMA wants to test whether the proposal would provide a clearer and more appropriate regulatory pathway for these products, while supporting innovation and maintaining confidence in New Zealand’s financial markets.
Stablecoins are digital tokens designed to maintain a stable value, usually by being linked to a currency such as the New Zealand dollar. They can be used to make payments and transfer value using digital technology.
The proposed approach would only apply to stablecoins that meet specific requirements. These include being referenced and backed by New Zealand dollars held at a registered bank and being redeemable at face value.
The proposal is intended as an interim step while broader work on the future regulation of digital assets continues.
