- The head of the Reserve Bank of New Zealand, Adrian Orr, doubted the stability of stablecoins.
- He stated that such assets will not be able to replace fiat currency.
- Adrian Orr also criticized the use of Bitcoin as a unit of account or medium of exchange.
On 12 February 2024, the Governor of the Reserve Bank of New Zealand (RBNZ), Adrian Orr, appeared before the Parliamentary Finance Committee. He stated that stablecoins and Bitcoin are not a means of exchange or store of value.
In his speech, Orr criticized “stable coins.” He noted the regulator’s concern about decentralized digital currencies and stablecoins. According to Orr, such assets cannot replace fiat currency and are not stable.
“Bitcoin is not a medium of exchange or a unit of account. However, people try to use it that way. In turn, stablecoin is a misnomer. He has no stability,” he said.
Adrian Orr urged the public to be as objective as possible and treat such assets as speculative coins, not bank cash.
“The New Zealand dollar exists because it has power and a reliable institution behind it. — an independent central bank,” said the head of the RBNZ.
According to Orr, there is a need to put regulatory pressure on the stablecoin industry. He described the UK as a jurisdiction where “this issue is being dealt with very hard.”
According to a July 2023 report, New Zealand is exploring various options for using a central bank digital currency (CBDC). Meanwhile, the parliament report recommended refraining from hasty regulation of cryptocurrencies. The authorities proposed creating consistent guidelines for handling digital assets in accordance with current legislation:
Let us remind you that in November, the Easy Crypto crypto exchange launched a stablecoin pegged to the New Zealand dollar. We also reported that the US Congress is close to passing a law on “stable assets”.