Nigeria Wants Legal Framework for Blockchain Regulation

Nigeria is pushing its regulators to put in place rules to regulate blockchain and cryptocurrencies.

Nigerian lawmakers are pushing the country’s central bank and the Nigerian Deposit Insurance Commission (NDIC) to establish a legal framework to regulate the blockchain technology space, Business Day reported.

Members of Nigeria’s House of Representatives have passed a resolution in addition to an earlier motion submitted by Solomon Adaelu. The latter highlights the uniqueness of the blockchain technology and its potential to improve financial services.

Adaelu said in his motion:

“Blockchain as a digital and decentralization ledger technology that records all transactions without the need for a financial intermediary bank is new to humanity and can be a core payment facilitator for the financial services industry.”

He noted that since the first cryptocurrency, Bitcoin, was introduced in 2008, blockchain has been credited with addressing the challenges presented by double-spending in virtual currency transactions without the need for a centralized authority or server.

Even leaders of the G20 agreed during their summit in Buenos Aires last month to draft unified rules on cryptocurrencies, he said.

"Countries such as the USA, the UK, Russia, Venezuela, and Kenya have provided a framework for the regulations of this emerging technology,” he added.

Cryptocurrency mining poses energy problem in Nigeria

The cryptocurrency craze has descended on Nigeria as well, and the nation has been experiencing energy problems due to Bitcoin mining operations. Mining a single piece of digital currency consumes at least 24 terawatt-hours of electricity per year, which is enough to power a single average American household for at least seven days.

In a report, Motherboard Vice said that Bitcoin mining is producing a large amount of waste and carbon emissions and is costing the world more than it should.

Each Bitcoin transaction consumes an average of 215 KWh per day, more than the average 901 KWh monthly energy consumption of an average American.

Motherboard Vice stated:

"That means that, at a minimum, worldwide Bitcoin mining could power the daily needs of 821,940 average American homes."