Compliance

AML & KYC Regulations

Over the years Bitcoin & other crypto-currencies have gained attention around their potential use in criminal activity and other nefarious activity.

Unfortunately the service and security bitcoin provides to people around the world can also be used to fund criminal activity. It’s much more difficult for government and enforcement to manage crypto currencies because of its decentralized nature outside the traditional banking system.

In order to help the government and mitigate the risk of bitcoin being used for the wrong reasons it’s important that we not only comply with the Anti-Money Laundering and Countering Financing of Terrorism Act 2009 (AML/CFT), but also proactively report suspicious activity.

All parties involved in any transactions with bit-coin.nz will need to verify their identity and comply with our processes and broader AML/CFT regulations.

For some the information required might feel intrusive to their right to privacy and it’s a balancing act between providing a quality service and doing our bit to help stop unlawful activity.

Because of this pro-active approach we’ve been able to provide banks with the names and account numbers of compromised accounts and save people a lot of heart break, who otherwise could have seen their money stolen.

None of data provided to bit-coin.nz will be sold or given to any 3rd party entities outside the scope of AML/CFT regulations.

FMA Compliance

I’m currently in discusion with the FMA on Cryptocurrency compliance, in the mean time the following services are not allowed to be provided by bit-coin.nz:

  • Providing finance advice on cryptocurrencies and other investment options
  • Acting as a broker for the purchase of bitcoin or other cryptocurrencies, crypto-derivatives, futures contracts, token products.
  • The storing of any cryptocurrency (such as wallets, escrow services etc)
  • Financial services related to bitcoin (loans, crypto-finance etc)

Bitcoin and Tax

The IRD has released guidelines on tax, you can read more here. In short you will be taxed on profit related to cryptocurrency but will also be able to offset expenses/loses. It’s really important to keep a record of any cryptoasset transactions to be able to accurately meet tax obligations, this includes;

  • the type of cryptoasset
  • date of the transaction
  • type of transaction (for example, received or disposed of)
  • number of units
  • value of the transaction in New Zealand dollars
  • total units of each cryptoasset held at the beginning and end of the year
  • exchange records and bank statements
  • wallet addresses.

you can read more on reporting here

Tim