Kiwi Bank cancelled my account because of crypto trading

I deal with cryptos and in particular Bitcoin. I buy/sell crypto on localbitcoins and other global platforms. I asked the FMA if I can do this and if there needs to be any licensing and they said yes so long as I do it as an individual and I don't need to be regulated (AML,KYC ...) or need to be licensed although I do my own checks when I trade on localbitcoins. So I was happily doing this and needed to create additional bank account as I wanted to move to a new bank. As I deal with people who are Kiwi Bank customers a lot so I tried to join Kiwi Bank online. In the form it asks "Other than salary and wages, do you receive funds from any of the following industries?Antique dealer,Bullion or precious metal dealer,Casino or Lottery and gambling operations .......Virtual currencies e.g. bitcoin". I said yes as I get funds from selling BTC. It asks for reason but the system doesn't work well so had to go to a local branch.
I needed to explain what crypto currencies are to the bank person and after some lengthy discussion the account got created. I got told I need to provide bank statements from my current bank and also to show my activities related to BTC trading. I gave all of that and got told it will be sent to the head office for verification but should be ok as I have declared my BTC transactions .... until then I am not allowed to use my new account. Got a phone call few days later and got told the new account will be cancelled as I'm dealing with crypto currencies. I asked if this is because of my trades or if BTC is treated as illegal in their terms and I haven't got any answers yet.
I have seen few articles where NZ banks shutdown accounts because of cryptos .... but has this happened to anyone with any bank? I was upfront about it to avoid any nasty conversations later on. Also, lots of people on localbitcoins have accounts with all of the major banks and are the banks going to shutdown their accounts if they know or they have special permits of some sort? Is there any crypto friendly bank in NZ?
Cheers