Suspended NZ Crypto Coins Will Be Relaunched In early 2019
In May 2017, Cryptopia, New Zealand’s largest cryptocurrency exchange launched NZDT, the first cryptocurrency token tethered to the New Zealand dollar. The crypto was launched when investors wanted a secure access to the New Zealand banking system to trade cryptos. Prior to the launch of the product, many problems existed, like high exchange costs and fraud.
Following the launch, the price of cryptos soared and NZDT provided the Kiwis an avenue to get in on the investing action. However, this did not prevail for too long. At the end of 2017, Cryptopia suspended the token as ASB, the bank associated with the exchange started being cautious following regulatory difficulties.
Now, almost a year later the exchange says that the company has partnered with a smaller bank and are ready to launch NZDT again in the first quarter of 2019. The exchange is making efforts to talk to the government and regulators and have received a positive reception.
Adam Lyness, the Business Manager executive of Cryptopia says:
“Initially we were just small, flying under the radar. But within three or four months we were transacting NZ$1 million a day – significant business. The bank’s challenge was how does this sit with our compliance and know your customer (KYC) obligations. It was our money in the account, but we were moving fast and building the market and the bank was worried: what if customers used the bitcoin to do something bad like buy drugs on the black market? This was at the same time as scandals in Australia, and they didn’t want unexpected headlines. Their inclination was to pull the service.”
Campbell Pentney, crypto tax expert and a trader says that the relaunch of NZDT will mark a significant turning point. He says:
“Not having them matters hugely. It was going great guns, growing massively fast, and then suddenly there was no banking access. People are saying: ‘how do I buy bitcoin?’ There are a few cryptocurrency exchanges in New Zealand, but volumes are very low and few people are using it. If you had a large amount in bitcoin, it would be quite difficult to get it out. Some banks are cautious about cryptocurrencies and anti-money laundering legislation and some go as far as closing your account you if you are dealing with cryptocurrencies.”
Lyness assured that the demand for NZDT is still strong as ever although the company has faced adversity when it comes to trading volumes. The management hopes that with the reintroduction of the token things become better.