New Zealand’s Reserve bank consulting public on a possible CBDC

The Reserve Bank of New Zealand can scrutinize the potential for a CBDC “to work alongside cash as government-backed money,” and assess the problems within the emergence of crypto assets like stablecoins.

The Reserve Bank of New Zealand says a central bank digital currency may be a “solution” to the continued reduction in the use of cash which it’ll look more close to the utilization of cryptocurrencies.

The bank can open up public consultations concerning a CBDC and also the emergence of recent digital styles of cash together with stablecoins.

An announcement on July 7 the bank said it’ll be introducing a group of “money and cash issues papers for feedback from August to November,” that repose on the “Future of Cash” consultations from 2019.

The bank can “introduce and request feedback” on crypto-focused papers that may scrutinize the potential for a CBDC “to work alongside cash as government-backed money,” in conjunction with unspecified problems that arise from innovations in cash and payment tech, together with cryptocurrencies like Bitcoin and stablecoins.

NZ’s Reserve bank seems to be broad-minded towards the preparation of a CBDC, however it emphasises that a measured and cautious approach is needed.

Assistant Governor Christian Hawkesby said in October 2020 that the bank had “no imminent plans” to deploy a CBDC, noting that “to issue currency that meets the requirements of the general public, we have a tendency to take a brand new and holistic approach. we have a tendency to acknowledge there’s much work to be done.”

In the latest CBDC connected announcement, Hawkesby notes that:

“The potential for a Central Bank Digital Currency to assist address a number of the downsides of reducing physical money use and services are a few things we wish to explore for New zealand.”

“A CBDC, the same as digital money, may somewhat be a part of the answer, however we want to check our assessment of the problems and projected approach before developing any firm proposals,” he added.

The Assistant Governor expressed that despite the declining amount of New Zealanders mistreatment cash, it’s still “widely valued as a result of it ensures inclusion” and provides the voters “autonomy and selection within the means they pay and save.”

“Personal and retail customers are fighting the loss of cash and in-person banking services despite banks’ efforts to assist them adapt,” he added.

However, Hawkesby noted that digital payments are the popular choice for the bulk of recent Zealanders which the bank’s “job is to make sure that these transitions work for all New Zealanders”:

“We also know that digital forms of payment are the popular means of paying for the majority of us, and that the future will without doubt involve less cash.”