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New Zealand’s central bank has started exploration into launching a central bank digital currency, with ongoing investigation projected until approximately 2030.
The Reserve Bank of New Zealand is now exploring the introduction of a central bank digital currency (CBDC) also known as “digital cash,” as innovations in money and payments are “challenging New Zealand’s monetary sovereignty,” according to Ian Woolford, Reserve Bank director of money and cash.
In a press release on Apr. 17, the central bank said digital cash would coexist with physical cash options and would not require a commercial bank account for usage, only a digital wallet, payment card, or mobile app. Woolford emphasized that digital cash would bring more enhancement to privacy, security, and trust for users, adding that the central bank “will not control or see how you spend your money.”
“It would also work via Bluetooth, so you could make payments without connecting to internet. This would be useful in an emergency, or when the power is out.”
Ian Woolford
The consultation period for shaping the high-level design of digital cash will last until Jul. 26, 2024, marking the initial phase of a multi-stage exploration anticipated to extend until approximately 2030, with ongoing opportunities for public engagement, the press release reads.
The decision to explore digital cash follows comments made by Adrian Orr, the governor of the Reserve Bank of New Zealand, who criticized stablecoins, stating that they can’t replace traditional currency and are inherently unstable. As crypto.news reported, Orr expressed skepticism about stablecoins during a parliamentary finance committee meeting in February, describing them as “the biggest misnomers” and “oxymorons.”
