New Zealand FMA Seeks Feedback on Proposed Regulatory Classification for NZD Payment Stablecoins

On Nov. 9, the New Zealand Financial Markets Authority (FMA) announced it is seeking feedback on its proposed classification scheme for New Zealand dollar-denominated and backed stablecoins. Under the proposal, stablecoins meeting specific conditions will not be classified as financial products under the Financial Markets Conduct Act.

The proposed conditions include being fully backed by funds held in bare trusts at New Zealand-registered banks, redeemable at par value without paying returns to holders; issuers must also continuously comply with requirements including public reporting of reserves. The consultation period closes on Dec. 18, and the FMA stated that no decision has been made yet.