Bitcoin and other cryptocurrencies have been on a persistent upswing this year, but they’re still pretty volatile. But during a time when even some of the most developed economies in the word are watching their currencies bounce around like the Argentine peso (just take a look at a six-month chart for GBPUSD), New Zealand has decided to take the plunge and become the first country to legalize payment in bitcoin, the FT reports.
The ruling by New Zealand’s tax authority allows salaries and wages to be paid in cryptocurrencies such as bitcoin from September 1, as long as the payments are in regular, fixed amounts. The digital currency of choice must also be pegged to at least one regular currency and must be able to be converted directly into a standard form of payment.
This makes New Zealand the first country to legally support payment in crypto. There are, however, some stipulations: In a bulletin dated Aug. 7, New Zealand’s Inland Revenue excluded self-employed taxpayers from earning incomes in cryptocurrencies, and added that some companies that choose to pay their employees in bitcoin or other crypto will be able to withhold tax under New Zealand’s ‘pay as you earn’ income tax scheme.