Binance Obtains New Zealand License as Huobi Shuts Down Derivatives
Binance, the world’s largest crypto exchange by volume traded, has secured licenses to operate in New Zealand even after rival Huobi halted derivatives trading last month over regulatory concerns. .
The influential exchange was approved as a financial services provider and launched Binance New Zealand. The registration, which allows it to offer a regulated spot exchange, was completed with the New Zealand Ministry of Business, Innovation and Employment (MBIE).
The New Zealand license also allows Binance to offer its crypto trading services as a regulated currency exchange with money or value transfer, asset management, and OTC trading services.
“I guess for some it’s easy to overlook because it’s a smaller market, but we see significant value in having a serious presence in New Zealand. We see New Zealand as a bit of a trailblazer so from that perspective I think there’s a lot to learn here with our local team working with Kiwis to look at the future of currency, transactions and the Web,” said Changpeng Zhao, founder of Binance. .
There are no detailed regulations for cryptocurrency in New Zealand. But, in fact, the country’s tax office had already gotten the go-ahead to collect crypto investors’ information from local exchanges to see if they pay their dues.
New Zealand views digital assets as goods rather than forms of currency. As a result, cryptocurrency investors may be liable for corporation tax, income tax, or capital gains tax depending on their activities and the type of transaction.
The agency, in New Zealand called the Inland Revenue Department (IRD), has asked all businesses to hand over personal details of customers – information that includes occupations, names and addresses, and the value and type of their crypto assets.
This decision shows how regulators around the world are not only concerned with combating cryptocurrency-related crimes, but also with prosecuting those who use the virtual asset to hide their wealth or avoid paying. taxes. It’s not new, but it’s a bit complicated because a booming market over the past two years has made some crypto dealers millionaires virtually overnight while others have lost their fortunes as a result. of the market-wide crash of 2022.
Under previous laws, crypto exchanges and other companies acting as intermediaries can voluntarily provide customer data, but they can now refuse or appeal requests from authorities to provide information.
Its closest neighbor, the Australian Taxation Office, also requires cryptocurrency users in the country to report their transactions in order to verify tax compliance. Warning them of stiff penalties if they fail to report their income or pay taxes on crypto holdings, the ATO said earlier this year that more than 2 million people are set to receive letters by mail or e-mail. -mail to “remind” them of their obligations.