NEW ZEALAND Law and Practice Contributed by: James Cochrane, Andrew Comer, Carlo Wan and Graeme Crombie, Lane Neave
See 2.2 Crypto-Asset Regulatory Frameworks for a full discussion of the applicable regulatory frame- works. The DIA has reiterated that businesses accepting crypto payments must comply with AML/CFT obliga- tions where they are virtual asset service providers. The IRD treats salary or bonus payments in crypto- assets as taxable income subject to PAYE. If a taxpayer receives crypto-assets as payment for goods and services provided, the taxpayer will still need to charge GST on those goods and services. 6.2 Stablecoins 6.2.1 Fiat Currency and Algorithmic Stablecoins New Zealand’s regulatory framework does not dis- tinguish between fiat-backed stablecoins and algo- rithmic stablecoins. There is no dedicated stablecoin legislation, and the classification of any stablecoin depends on its specific features and functions – assessed on a case-by-case basis by the relevant regulator – rather than on its label or the mechanism There is no bespoke regulatory framework for stable- coins in New Zealand. Currently, the FMA assesses each stablecoin on a case-by-case basis based on its features and functions. The key considerations for whether a stablecoin is a financial product are dis- cussed in 2. Regulation . by which it maintains its peg. 6.2.2 Stablecoin Regulation In October 2025, the FMA designated the NZDD as not being a financial product under the FMC Act, on the basis that it is not an investment, pays no income or interest to holders, and is used practically as a means of payment or remittance. This designation is product-specific but signals how the FMA may approach similar stablecoin models. 6.2.3 Backing Assets See 6.1 Payments and 6.2.2 Stablecoin Regulation . 6.2.4 Special Considerations See 6.2.2 Stablecoin Regulation .
orders), alongside AML/CFT sanctions for reporting entity breaches and FSP (RDR) Act offences for unreg- istered retail activity. The FMA also regularly issues public warnings and alerts about crypto-asset scams and unregulated platforms targeting New Zealanders, highlighting the system’s recipient-focused reach. New Zealand courts have treated digital assets as capable of being property, with consequences for trust, insolvency and enforcement analysis in cryp- to-asset failures. While individual DeFi cases remain limited, this general approach informs remedies (eg, proprietary claims) where platform failures or miscon- duct affect New Zealand users. Notably, while the Cryptopia decision did not involve DeFi, it nonetheless evidences the willingness of the New Zealand courts to analyse digital asset arrange- ments using ordinary legal principles. In summary, DeFi is not subject to a separate regime in New Zealand. Compliance turns on the services provided, the financial product perimeter, and who in New Zealand receives the service, with standard FMC Act, AML/CFT Act and FSP (RDR) Act mechanisms governing conduct, disclosure, licensing, supervision and enforcement. Payments in crypto-assets are permitted in New Zea- land. There is no legal prohibition on using cryptocur- rency to pay for goods and services, and businesses and individuals are free to accept crypto-assets as a form of payment. However, crypto-assets are not legal tender – they are classified as “property” rather than money or currency under New Zealand law, and their acceptance as payment is entirely voluntary. Pay- ments in crypto-assets engage the regulatory regimes outlined earlier in this chapter. Whether a crypto payment service is regulated depends on whether the activity constitutes a finan- cial service under the FSP Act or whether the crypto- asset itself is a financial product under the FMC Act (in which case, FMC Act obligations apply). 6. Payments and Stablecoins 6.1 Payments
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