Crypto License in New Zealand

New Zealand is emerging as an attractive jurisdiction for cryptocurrency businesses due to its progressive regulatory environment and business-friendly policies. Entrepreneurs looking to operate in the country must obtain a crypto license in New Zealand, which ensures compliance with financial regulations and market standards.

Cryptocurrency Regulations in New Zealand

Is cryptocurrency legal in New Zealand?

Yes, cryptocurrency in New Zealand is legal and is regulated under the Financial Markets Conduct Act. Crypto businesses must comply with AML and financial service provider (FSP) regulations.

Is New Zealand crypto-friendly?

Yes, New Zealand is considered a crypto-friendly jurisdiction with clear regulations and a progressive approach to fintech innovation.

New Zealand Crypto Laws

The government enforces strict compliance measures to prevent financial crime. Crypto service providers must register with the FMA and adhere to strict AML rules.

New Zealand Cryptocurrency Exchange Regulation

Cryptocurrency exchanges operating in New Zealand must register with the FSP and comply with reporting requirements.

Advantages of Obtaining a Crypto License in New Zealand

Securing a cryptocurrency license in New Zealand offers several key benefits:

• Legally: A favorable legal environment for the development of crypto business.
• Prestigious: A prestigious jurisdiction that allows you to work unhindered and inspires confidence among partners and customers.
• Mastering the Global Market: Good reputation for the possibility of cooperation with customers around the world, especially in the Asian and Oceania market.
• Simple: No requirements for authorized capital and residency of beneficiaries, possibility of obtaining crypto registration remotely.
• Payment Solutions Availability: Possibility of opening an account with reliable payment institutions.

Crypto registration functionality in New Zealand

A financial service provider (FSP) registered in FSPR with such a financial service as “operating a money or value transfer service”  is authorized to:

• exchange fiat money (New Zealand or foreign currency) to crypto currency;
• exchange crypto currency into fiat money (New Zealand or foreign currency) as part of a digital currency exchange business.
• exchange crypto to crypto. 
• make transfers of cryptocurrency. 

Requirements for a Crypto License in New Zealand

To obtain a cryptocurrency license in New Zealand, businesses must meet specific regulatory requirements:

• Founder Requirements: Any individual or legal entity not listed in sanction lists and without any criminal record can be a founder. There are no residency requirements for the founder.
• Director Requirements: You’ll need a local office (under the lease agreement).
• Office Requirements: A virtual office in Australia is sufficient, for which you can use the director’s residential address.
• AML/CFT Compliance: The company must develop AML/CFT documentation:
  • Reporting suspicious activities and certain transactions.
  • Verifying the identity of customers in some ­­circumstances.
  • Assessing and mitigating money laundering and terrorism financing risks.
• Minimum annual business threshold: In order to remain registered the FSP must provide financial services to persons in New Zealand above the minimum annual business threshold, being:
  • 10 New Zealand resident financial services clients, and
  • 10,000 NZD of financial services transactions in total with its New Zealand resident clients.

In the first 6 months after registration, the provider must have achieved half of the threshold, that is, 5 New Zealand clients and 5000 NZD of transactions with New Zealand resident clients. 

• Dispute Resolution Scheme: An FSP is required to engage a dispute resolution provider’s.

Company Registration in New Zealand

The process for registering a New Zealand crypto license involves several steps:

1. Company Formation: Preparation of corporate documents and company registration (2 weeks)
2. AML Compliance: Preparation of AML/CFT policies, Business Plan and Governance Manual (1 month)
3. License Application: Submitting application to the FSPR (1 week)
4. Review: Review of the application and FSPR decision on registration (up to 3 months).
5. Account: Business account opening (1 month).

Taxation in New Zealand

Crypto businesses in New Zealand are subject to taxation, including:

• Corporate Income Tax: 28% on business profits.
• Goods and Services Tax (GST): Cryptocurrency transactions are exempt from GST.
• Capital Gains Tax: New Zealand does not impose a capital gains tax, but profits from crypto trading may be subject to income tax.
• Withholding tax: When paying dividends to non-resident from profits on which income tax was not paid – 30% (can be reduced to 5% or 15% under the relevant treaty with New Zealand)

New Zealand’s tax policies ensure regulatory compliance while providing favorable conditions for crypto businesses.

Conclusion

Obtaining a crypto license in New Zealand enables businesses to operate legally and access global financial services. With its well-defined New Zealand crypto laws and strong regulatory framework, the country remains an attractive destination for crypto entrepreneurs. Working with experienced legal professionals can help ensure full compliance and a smooth licensing process.