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New Zealand Banks Maintain Cautious Stance on Cryptocurrency to Ensure Customer Safety

June G. Bauer



Major banks in New Zealand are standing firm on their strict controls and, in some cases, bans on cryptocurrency users and traders. This approach has drawn criticism from Easy Crypto, a local crypto firm, accusing the banks of bullying behavior for refusing transactions and denying bank accounts to businesses and consumers involved in digital currencies. The country’s top five banks justify their caution by citing international and domestic risk warnings from regulators, including the Financial Markets Authority. Instances of large-scale crypto scams, such as the collapse of the US-based trading platform FTX, have further fueled their concerns.

Bank Policies Reflecting Customer Safety

New Zealand banks have implemented varying policies regarding cryptocurrency transactions, with Kiwibank and ASB Bank adopting a case-by-case approach. ASB Bank emphasized their commitment to customer safety in a complex regulatory environment, mentioning compliance with anti-money laundering, sanctions, and counter-terrorism financing laws. Westpac New Zealand, on the other hand, takes a highly risk-averse stance, refraining from providing routine banking services to participants in the digital currency exchange industry.

ANZ’s Approach and BNZ’s Risk Classification

ANZ Bank shares Westpac’s cautious stance but permits personal customers to engage in some cryptocurrency transactions, as long as there are no commercial interests involved. BNZ, guided by regulatory advice, acknowledges the growing traction of cryptocurrencies and monitors industry developments. While the bank does not outright prohibit dealing with cryptocurrency-related businesses, it categorizes cryptocurrencies as high risk, setting a risk threshold for onboarding customers operating in this sector.

Kiwibank’s Case-by-Case Assessment

Kiwibank, a New Zealand-owned institution, takes a more open position compared to other major banks. The bank assesses potential customers on a case-by-case basis, requiring evidence of compliance with anti-money laundering and counter-terrorism finance obligations as a minimum requirement.

Ensuring Compliance and Monitoring

New Zealand banks are closely adhering to regulatory guidance while recognizing the rising popularity of cryptocurrencies. They acknowledge the risks associated with the industry and adopt measures to safeguard customers and maintain compliance with anti-money laundering and counter-terrorism finance regulations.

Legal Tender Distinction

Although cryptocurrencies are widely accepted in New Zealand, it is important to note that they are not recognized as legal tender. Unlike traditional fiat currencies issued by central banks, cryptocurrencies do not possess the status of official payment methods. However, this distinction does not impede their use as a medium of exchange or investment instrument within the country.

Increasing Popularity of Cryptocurrency Investments

The 2022 survey conducted by the New Zealand FMA sheds light on the growing popularity of cryptocurrency investments among the nation’s population. Approximately 10% of New Zealanders have chosen to allocate their investment portfolios to cryptocurrencies, indicating a significant level of participation and trust in these digital assets. This trend reflects the increasing recognition of cryptocurrencies as an alternative asset class with potential for long-term growth.

Final Thoughts

As the cryptocurrency landscape evolves, New Zealand’s major banks remain cautious in their approach to mitigate risks and protect their customers. Compliance with complex regulatory requirements, concerns over scams, and international risk warnings contribute to the banks’ careful handling of cryptocurrency-related transactions. The evolving nature of the industry and regulatory developments will continue to shape their policies and approaches to ensure a secure and compliant banking environment.

Pop cultureaholic, Technology expert, Web fanatic and a Social media geek. If you have any questions or comments please feel free to email her at [email protected] or contact her on Twitter @JuneTBauer1


Kuwait Authorities Unanimously Ban the Use of Virtual Assets





In a collective effort, the regulatory authorities in Kuwait, represented by the Central Bank of Kuwait, the Capital Markets Authority, the Ministry of Commerce and Industry, and the Insurance Regulation Unit, have issued directives to ban the use cryptocurrencies and other unregulated virtual assets within the country.

The Kuwaiti Capital Markets Authority stated in an announcement released on Tuesday that these recommendations are provided by the Financial Action Task Force (FATF) to combat money laundering and terrorism financing. The issued directives impose an “absolute ban” on most digital currency transactions, including their use for payments or investments, as well as the prohibition of mining activities. Additionally, the regulatory authority restricts local authorities from granting licenses to companies seeking to provide services related to virtual assets as business activities.

The announcement states that the comprehensive ban does not include securities and other financial instruments regulated by the Central Bank of Kuwait and the Capital Markets Authority. The primary objective of these directives is to safeguard users from the risks associated with virtual assets. These proactive measures represent a significant step by the Kuwaiti authorities to mitigate the risks linked to investing in such assets, often used for speculative purposes.

The continuous awareness campaigns launched by regulatory authorities in Kuwait caution cryptocurrency users, especially those dealing with popular digital currencies such as Bitcoin (BTC), Ethereum (ETH), Dogecoin (DOGE), and others, about the potential risks associated with their usage and investment.

Moreover, since 2017, the Central Bank of Kuwait has prohibited commercial banks and other financial institutions from processing any transactions involving Bitcoin. In May 2021, the bank reaffirmed the illegality of digital currencies in the country.

Before the ban, Kuwait did not impose taxes on income derived from digital currencies, leaving the door open for investors in the crypto space.

Mining companies had previously shown interest in establishing a base in Kuwait due to its low electricity costs. However, the recent campaign has closed the door on crypto investments and mining activities within Kuwait.

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Unlocking the Tax Maze: Cryptocurrency Compliance in Australia

June G. Bauer



As tax season approaches, cryptocurrency owners in Australia are being urged to be vigilant and comply with tax regulations. With the Australian Taxation Office (ATO) prioritizing capital gains, including cryptocurrencies, individuals who have omitted crypto transactions from previous tax returns may face scrutiny.

According to Sky news, With millions of Australians estimated to invest in digital currencies, the ATO’s data-matching program monitors crypto transactions to ensure tax law compliance. Experts emphasize the importance of understanding capital gains rules and keeping accurate records to avoid potential penalties.

According to Danny Talwar, head of tax at crypto tax calculator Koinly, many Australian crypto owners mistakenly overlook the country’s capital gains rules and their application to digital currencies. While converting crypto into Australian dollars is commonly known to require reporting, individuals must also report instances where one cryptocurrency is used to purchase another. Talwar highlights the necessity of documenting the purchase price, sale price, and market value of the acquired crypto asset. Neglecting proper record-keeping can have serious consequences during tax time. To streamline the process and ensure compliance, utilizing a crypto tax calculator is highly recommended.

ATO Assistant Commissioner Tim Loh advises consulting with a registered tax agent to ensure compliance with tax regulations. Crypto assets are generally subject to capital gains tax, and activities involving crypto often result in taxable transactions. Even selling or withdrawing crypto at a crypto ATM may not qualify for the “personal use” asset exemption. Taxpayers are required to report gains or losses from disposing of crypto assets in their tax returns. Loh emphasizes the importance of maintaining comprehensive records of crypto dealings to accurately report during tax time.

In addition to the crackdown on crypto transactions, the ATO has identified three other priority areas this tax season. Changes to work-from-home deductions now require taxpayers to use the actual cost or revised fixed-rate method (up to 67 cents per hour) rather than the blanket 80-cents-per-hour rate. Record-keeping requirements have also been updated, with Australians working from home obligated to maintain records of all hours worked throughout the financial year. Rental-property deductions, particularly interest-expense claims, are under scrutiny due to previous errors detected in up to 90 percent of landlords’ returns. Furthermore, the ATO will focus on ensuring accurate reporting of income earned from side-hustles and gig-economy work.

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Texas Emerges as a Cryptocurrency Mining Hub

June G. Bauer



Everything truly is bigger in Texas, and that includes cryptocurrency mining operations. The Lone Star State currently boasts the largest cryptocurrency mining facility in North America, accounting for approximately 15% of global mining operations, according to researchers.

However, along with the massive scale of these mining operations comes an equally large power consumption. Cryptocurrency mining involves running complex computation algorithms to validate transactions, and the more calculations a computer can solve, the higher the chance of receiving cryptocurrency rewards, such as Bitcoin, explains the Texas Comptroller.

“In a nutshell, mining Bitcoin is an extremely energy-intensive process. This is why the computing demands have reached a level where they rival the electricity consumption of entire cities,” explains Le Xie, a professor in the Department of Electrical and Computer Engineering at Texas A&M University.

By 2023, the Texas Comptroller estimates that cryptocurrency mining facilities in the state could demand as much power as Houston, the fourth-largest city in the U.S. Already, these facilities are consuming energy on par with the city of Austin, adds Xie.

Despite the significant energy requirements, Texas political leaders have actively promoted the state as an attractive destination for mining companies, citing the economic benefits they bring to rural areas. However, questions arise regarding the risk these mining operations pose to the Texas energy grid.

Professor Le Xie has conducted extensive research on the impact of mining facilities on the Texas grid. His studies focused on three key areas: grid reliability, carbon dioxide emissions, and wholesale energy market prices.

“Their impact largely depends on how you model them,” explains Xie. If these facilities are modeled as constant demand, there can be a substantial impact on grid reliability, as they require continuous power and may strain the grid during peak periods.

Conversely, if the facilities are flexible and can be turned off during periods of grid instability, they could potentially provide additional energy to support the Texas grid, according to Xie.

The findings from Xie’s team were published in the March issue of the Institute of Electrical and Electronics Engineers Transactions on Energy Markets, Policy, and Regulation, as well as the June issue of Advances in Applied Energy.

“We are pleased to share that the models and data we have utilized can be beneficial not only in Texas but also across the country. They provide decision-makers with insights into the performance of mining facilities during stressful situations,” states Xie.

As the cryptocurrency mining industry continues to expand in Texas, further research and careful consideration of its impact on energy consumption and grid reliability will be crucial to ensure sustainable growth and stability in the state’s energy infrastructure.

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