The Parliament of New Zealand’s Finance and Expenditure Committee is all set to learn about nature, impact and risks involved in cryptocurrencies. It will explore the benefits of cryptocurrencies and the risks involved for the users and Aotearoa.
The New Zealand Parliament’s Finance and Expenditure Committee is doing an enquiry into the nature, impact and risk of cryptocurrencies. The committee will explore the nature and benefits of cryptocurrencies along with the risks to both users and Aotearoa.
Dr Duncan Webb, Committee Chairperson said that the inquiry will give a good opportunity to further understand this increasingly important topic. With this inquiry, it will be able to understand how cryptocurrencies are created and traded. The study will also focus on the environmental impact of crypto coin mining.
How is mining done
Mining is a mode through which people acquire cryptocurrency without buying it. Miners get the currency as a reward for using computer processing power to solve complex issues and then record the data on the blockchain. Mining is a process that has had its share of appreciation and criticism to a larger extent.
As per the findings of the Cambridge Center for Alternative Finance, Bitcoin is one of the largest cryptocurrencies in the world and is one of the most popular ones as well. It consumes 110 terawatt-hours of electricity each year to create and trade.
Consumption of electricity hazardous for the environment
Electricity consumption is higher than that of New Zealand in one year and may be similar to Sweden and Malaysia. Considering it hazardous for the environment, Tesla CEO, Elon Musk too had withdrawn his holdings in Bitcoin and the company had stopped accepting payments in Bitcoin. He said that the company will consider resuming payment in bitcoin only when the miners start using 50 percent renewable energy.
Bitcoin and other cryptocurrencies which are becoming popular among crypto enthusiasts are in demand more. They have large market capitalization and are now regarded as big companies. The market capitalization of these coins is breaking their records. One such example is bitcoin, which is the leading cryptocurrency in the industry. It has many key influencers expressing support for bitcoin and its growth.
The committee formed by the Parliament of New Zealand will also look into how cryptocurrencies are used by criminals to bypass more traditional monetary systems. It is one of the reasons for China to stop both mining and crypto transactions in the country. As per the authorities in China, cryptocurrencies disrupt economic order and facilitate illegal activities, money laundering, transfers, etc.
The authorities in New Zealand will also enquire whether the cryptocurrency can be regulated by sovereign states, central banks or other multilateral corporations.
Andrew is a blockchain developer who developed his interest in cryptocurrencies while pursuing his post-graduation major in blockchain development. He is a keen observer of details and shares his passion for writing, along with coding. His backend knowledge about blockchain helps him give a unique perspective to his writing skills, and a reliable craft at explaining the concepts such as blockchain programming, languages and token minting. He also frequently shares technical details and performance indicators of ICOs and IDOs.