Ex PwC partner to introduce New Zealand stablecoin. Power Finance, a New Zealand-based financial services firm, aims to introduce what it calls a digital ‘world-first’ version of the New Zealand dollar. Set for launch early next year, distributed ledger technology will be used in the digital currency.
However, the “Power Dollar” is not government-backed, and is more akin to a stablecoin like Tether than a real digital dollar. It is being privately set up and will be backed by New Zealand dollars owned by Inland Revenue through its tax pooling scheme one-for-one.
The company is led by former PwC banking and capital markets partner Dave Corbett, and is backed by British investment firm Centrality Ventures as well as others.
All currency holders can have their identities checked and transactions registered by using DLT in conjunction with smart identity technology, helping to avoid money laundering and fraud. Corbett said the new currency was developed to work under existing regulations and added “I see the Reserve Bank every couple of weeks. It’s fair to say they’ve been supportive of what we are doing, but we’ve been stretching their mind about the future of banking looks like.”
Both the Reserve Bank of New Zealand, or RBNZ, and IR emphasised that they are not in cooperation with the firm in response to Corbett claiming that the digital dollar is “sovereign-backed.” IR is not responsible for overseeing financial firms, the Inland Revenue spokeswoman said, adding “Inland Revenue is not in partnership with Power Finance on this and neither have we endorsed that is it ‘sovereign-backed.’”
After launching the currency, the company will work to secure a banking license from the RBNZ, and if successful, start signing up “partners” to launch banking-style services that function outside of the traditional banking system, Corbett said.
“Our plan is to attach that [banking] license to the platform, which means that our partners will technically be able to operate as banks,” he said, adding the currency could be an important precedent for the RBNZ “This is a really great way to have a large scale experiment in New Zealand and it might be the thing that encourages the RBNZ to go ahead and do its own digital currency.”
Central banks have been looking closely at digital currencies around the world, and RBNZ has its own initiative underway to look at the future of the country’s cash system.
[image: Jeff Finley]