New Zealand is advancing its crypto regulation into 2026, reinforcing its property-based classification of digital assets through a wave of 2025 reforms. Profits are taxed as income, not capital gains—a stance first taken in 2018 and reaffirmed by the IRD: “If you acquire crypto assets to dispose of them, you need to pay income tax on any profit you make.”
Government Implements Measured Oversight for Fintech Sector
Aotearoa has advanced a subtle but effective approach to fintech regulation in 2025. The Conduct of Financial Institutions Act (CoFI), in effect from 31 March, mandates fair conduct standards across all financial institutions, including those operating in the crypto space.
The government launched the Regulatory Sandbox, giving blockchain startups room to test new ideas within a supervised environment that aims to “promote consumer protection and market integrity.”
New Laws Drive Transparency in Blockchain and Crypto Compliance
The Consumer and Product Data Act came into effect by 29 March, introducing a consumer data right (CDR) that indirectly impacts blockchain via stronger data access and transparency. Crypto regulation will extend further beginning 1 April 2026, when the OECD’s Crypto-Asset Reporting Framework (CARF) applies to digital transactions.
Crypto asset service providers (CASPs) will face mandatory reporting rules to “enhance transparency and combat tax evasion in the crypto space” as stated in the Taxation Act 2025.
FSP Registration Sets Compliance Baseline for Crypto Providers
Crypto operators in New Zealand operate without a specific crypto licensing regime. CASPs and wallet providers are required to register as financial service providers (FSPs) through the Financial Markets Authority (FMA).
The registration imposes standard Anti-Money Laundering (AML), Combating the Financing of Terrorism (CFT), and Know Your Customer (KYC) compliance responsibilities.
The FMA emphasises transparency without introducing regulatory bloat. CASPs are required to report transactions—particularly suspicious ones—to ensure market integrity.
IRD Maintains Income Tax Model Over Capital Gains for Crypto
Crypto-related profits in New Zealand are taxed through income brackets, following the government’s decision not to implement a capital gains tax. The IRD notes, “If you make a loss when you sell your crypto asset, you may be able to claim this loss.”
The income tax rates for 2025–2026 range from 10.5% to 39%, depending on annual income.
Regulators Remain Cautious as Crypto Adoption Grows in New Zealand
User adoption of crypto in New Zealand stands at 33.59% and is expected to rise to 34.78% by 2026. The FMA remains cautious, warning of scams in the decentralised environment. “Because it is decentralised by nature, there’s no control by a single entity,” the agency stated, noting the anonymity of foreign exchanges as a key risk.
Revenue from crypto is forecast to reach US$174.1 million in 2025, with annual growth projected at 15.37%.
The government has taken a measured path, backing responsible innovation while keeping its distance. Wellington continues a “wait and see” approach with no public crypto holdings however the legal clarity could help position the country as a future leader in sustainable crypto.