To make the country a hub of blockchain and cryptocurrency projects, the government of New Zealand needs to enact regulations for the local blockchain sector. This is the reason why professors at the University of Auckland recently published a report urging the local administration to establish a legal framework for the country’s crypto space.

Reportedly, the New Zealand Law Foundation has backed a study report that proposes the creation of digital currency tokens issued by the central bank as well as the drafting of acquiescent crypto regulations. As mentioned above, the report was written by dons from the University of Auckland. Essentially, it calls for the enforcement of crypto-friendly regulations in New Zealand. As a result, the country would become a crypto and blockchain hotbed, a development that has several potential benefits.

Since their inception, cryptocurrencies have been subject of contentiousness. Nobel Laureate Joseph Stiglitz is adamant that digital assets have no benefits, while others like Alexandra Sims expect cryptos to become mainstream. Therefore, Sims believes that New Zealand should start concentrating on the crypto space because other jurisdictions such as Singapore and Japan are hugely benefiting from implementing favorable crypto regulations.

While creating Bitcoin, Satoshi Nakamoto envisaged a monetary system that is free from government disruption and regulations. However, criminals are taking advantage of this to perpetuate illegal transactions. Regarding this challenge, the professors recommended the creation of reasonable regulations for digital currencies to eradicate the utilization of such methods to facilitate illicit dealings.

Notably, most of the prominent institutions in the traditional finance sector have expressed optimism in the potential of blockchain technology. However, this confidence does not extend to digital currencies, with some sections labeling this nascent asset class as mere bubbles. Nevertheless, Alexandra stresses that blockchain must be accompanied by cryptocurrencies for its potential to be realized.

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