- NZDT project flopped due to the criticism it received
- ASB had pulled out due to KYC issues
- Cryptopia has now gotten a new banking partner
New Zealand will in early 2019 re-launch its first crypto token tethered to the NZ Dollar. The news is likely to excite the country’s growing cryptocurrency enthusiasts and investors and disbelief among the rest of the population.
Initial Launch a Failure
NZDT was launched in May 2017 but the project flopped due to the criticism it received by speakers attending the annual blockchain conference as most cryptocurrency investors feared the cost of putting up cryptocurrency exchanges. There was also fear among investors they would lose money from their bank accounts if they bought the tokens directly from overseas sellers.
The Christchurch-based Cryptocurrency exchange Cryptopia suspended the NZDT last year following an expression of doubt and skepticism by ASB, the local arm of the Commonwealth Bank of Australia regarding their ability to identify their customers and activities.
Partnership with a New Bank to Re-launch NZDT
Cryptopia was forced to suspend NZDT withdrawals and deposits on April 20, 2018, via an official blog post due to issues with their banking partners but said they were looking for a new partner. The statement said at the time:
“We are working closely with our banking partners and hope to resume NZ dollar deposit and withdrawal services as soon as possible. Finding a solution is a high priority and we will notify our community as soon as there are further developments.”
That was then but things are now changing for the better. Cryptopia’s Business Development manager Adam Lyness has revealed that their new partner is a small but rather new bank that is ready to back their plans with NZDT, which they will launch in the first quarter of 2019. He stated:
“Initially we were just small, flying under the radar. But within three or four months we were transacting NZ$1 million a day – significant business. The bank’s challenge was how does this sit with our compliance and know your customer (KYC) obligations.”
Adam also hinted that their correspondence with the government’s regulators was now “positive and curious rather than critical” regarding the NZ Dollar pegged token. He revealed the suspension of the NZDT badly affected the company but they hoped to recover since the demand for NZDT was still high. Cryptopia has a staff of about 100 people and looks forward to Christmas and hopes the trend they have seen in the last four or five years will manifest themselves and help them regain their foothold. Lyness said:
“We’ve been lucky enough to be in the right place at the right time, but need to be a broader blockchain financial business, […] we are looking to build financial services outside speculation, using the knowledge we’ve gained from our cryptocurrency business.”