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2020-10-19

The "first version" of the New Zealand digital dollar

New Zealand's financial services company, Power Finance, plans to launch what it calls the "world's first" digital version of the New Zealand dollar. The digital currency to be launched early next year will use split book technology.

The "Power Dollar", however, is not supported by the government and is closer to a stable coin such as the Tether than to a real digital dollar. It is created privately and will be supported one for one by the New Zealand dollars belonging to the Inland Revenue through the tax pooling system.

The company is run by PwC's former banking and capital markets partner, Dave Corbett, and is supported by the UK investment firm Centrality Ventures as well as other companies.

Through the use of DLT in combination with smart identification technology, all currency holders will be able to verify their identity and record transactions to help prevent money laundering and fraud. Corbett said that the new currency was developed to operate within the framework of current regulations.

Once the currency is activated, the company will work to secure the bank license from RBNZ and, if successful, will start registering "partners" to launch banking services that operate outside the traditional banking system.