While America continues to quiz Facebook on the launch of its cryptocurrency, Libra, and other countries ignore or resist the legal use of cryptocurrency, New Zealand has taken a brave step and legalized the use of cryptocurrency in salary payments.
According to a report from the Financial Times, the country, on August 7, 2019, in its tax information bulletin formally announced its plans to allow for salary payments and bonuses to be made in cryptocurrency. Salaries paid used this method will still be subject to taxation, and self-employed workers cannot switch their income to cryptocurrency.
Whatever cryptocurrency will be adopted, it must be pegged to a standard currency and be directly convertible into a normal form of payment. What this means is that New Zealand is not just recognizing crypto, it is also formally allowing it to be a form of payment in so far as it adheres to certain rules. The new rule will take effect from the 1st of September 2019.
This historic move by the Oceania country is helping to further legitimize cryptocurrency and drive its adoption. Before now, Bitcoin and all other altcoins have been regarded as a form of technological invention to be feared rather than studied and adapted. This is mainly because of the difficulty in regulating or tracking its use. This challenge has made it susceptible to criminals and those wishing to fund illicit activities. However, refusing to legally recognize it or placing an outright ban does nothing to improve security measures around its use.
Will other countries take a cue and legitimize the use of crypto? Only time will tell.