This article provides a general overview of New Zealand and outlines two major strategic opportunities for Bitcoin locally including Bitcoin Mining and Māori self-sovereignty.

Written by Cody Ellingham and contributed to by New Zealand Bitcoin Community Members.

Overview of New Zealand

New Zealand is a small and innovative country in the South Pacific with a population of 5.2 million people.

It is a high-trust society with low corruption and easy business setup. It has an overall sense of transparency and honesty with a highly connected, educated, and capable population. There is relatively easy access to Government and regulatory structures and strong rule of law.

Business traits include innovation, collaboration, giving things a go, and a focus on solutions. Some of these factors are necessary due to the country’s small population and lack of immediate neighbouring markets or a depth of capital or human resources

Important industries include agriculture, tourism, and tech. Notably unlike countries such as Ireland, New Zealand is not a significant global banking or business haven, though the New Zealand Dollar is a top-10 traded currency. Additionally, 85% of New Zealand’s banks are foreign-owned.

New Zealand experienced a series of extreme lockdowns and Government overreach between 2020 - 2022 and has seen an increasing import of political divisionism, however this is still minor compared to many parts of the world, and for the most part New Zealand is safe and the sense of community is fair.

In 2023 there was a change of Government to a centre-right coalition and increasing push back against “narrative shaping”, and a more pragmatic approach to increasing cost of living and inflation issues.

See this article: The Bitcoin Scene in New Zealand in 2023 for more general NZ insight.

Bitcoin in New Zealand

There is a small but tight-knit Bitcoin community flourishing under legal clarity in New Zealand.

For most people price action and store of value are the main consumer drawcards to Bitcoin. Due to a lack of a deep capital and stock market New Zealanders have historically invested significantly in real estate. This has become increasingly unaffordable (especially relative to income levels) and instead many are now looking to speculative investment in stocks and ETFs as well as Bitcoin.

There are a number of Bitcoin-accepting merchants in New Zealand and a range of community-led Bitcoin initiatives including meetup events (Bitkiwi), Bitcoin spaces (The Altrust School of Bitcoin), media & podcasts (The Transformation of Value and Bitcoin Basics Help), and community websites (Kiwi Bitcoin Guide, Accept Bitcoin NZ).

New Zealand-based Bitcoin startups and businesses include Lightning point-of-sale payments and exchange provider lightning Pay, Bitcoin Miners (Stackr, Grid Share), open-source project contribution (Bolt Card Wallet), and more (Blockspace Energy, Orange).

There are a number of local and international custodial crypto fiat ramps available, as well as new Bitcoin-only entrants emerging (Lightning Pay).

Regulation and Legal Clarity

Bitcoin is legal in New Zealand and there are no significant barriers to Bitcoin use.‍

One issue is the reluctance of the commercial banks of New Zealand to work or engage with Bitcoin businesses due to perceived risk. This is not insurmountable however, and even small Bitcoin startups have been able to successfully gain fiat bank access after going through the regulatory compliance processes.

Since 2021 New Zealand’s Central Bank (the Reserve Bank of New Zealand) has been undertaking public consultation on the future of money, which has included regulation for Crypto currencies and the development of a CBDC. A number of recommendations were made to Parliament in November 2023 and as at March 2024, these have been acknowledged by the Parliamentary Select Committee but no further action has been announced.

The recommendations made to Parliament include adopting a technology-neutral approach and to foster adoption in the “Digital Assets” sector as well as more general recommendations covering taxation and responsibilities for legislation by different bodies.

Regulation in New Zealand is still being developed and there are opportunities for the establishment of a Bitcoin industry in New Zealand within this framework.

Opportunity: Bitcoin Mining

In the mid-term the big opportunity for Bitcoin is focussed on energy and mining. 

There are significant natural resources in New Zealand including renewable hydro and geo-thermal. Several Bitcoin mining businesses are already taking advantage of these, including Grid Share who operate a Bitcoin mining facility and demand response programme at the Lake Monowai Hydro Power Station.

Listen to an interview with Sam Kivi of Grid Share here.

Hydroelectric generation has been a part of New Zealand’s energy system for over 100 years and continues to provide the majority of electricity. Currently there's over 5,000 MW of installed hydro capacity. The majority of it is found in the South Island, though the major load demand centres are in the cities of the North Island. This situation means there can be opportunities for load balancing, behind-the-meter mining, and other configurations that integrate with the electricity grid. Though Bitcoin does not play any major role in current investment planning, this interview: ”How Bitcoin Helps the Renewable Energy Journey with Blair Walter”, gives an overview of how energy projects are funded in New Zealand, the market model, and the role Bitcoin could play. 

With the change of Government in 2023 there is a greater emphasis on infrastructure and building with removal and proposed removal of some regulatory barriers that may make Bitcoin mining projects even easier to get developed and "shovel ready".

• More information about New Zealand’s energy mix can be found here.

This interview with Dr Matthew Birchall of the New Zealand Initiative policy think-tank, ”Once Were Builders: Learning from New Zealand’s Past to Develop Better Infrastructure”, provides some insight into approaches to building infrastructure in New Zealand.

Additionally there is a chance to develop the narrative of the export of sustainably-mined Bitcoin globally, building an entirely new export sector and employment opportunities. There are also opportunities related to greenhouse gas emission reduction via the work of Daniel Batten and CH4 Capital that looks at methane flaring, etc.

Opportunity: Bitcoin and Māori Self-sovereignty 

The relationship between New Zealand’s indigenous people, the Māori, and the Government represents another big opportunity for Bitcoin in New Zealand. The Māori people are recognized in the 1840 Treaty of Waitangi as being the original occupiers and land holders in New Zealand, and were guaranteed certain rights and protections in this document. They represent about 17% of the population, or about 875,000 people.

However the reality nearly 200 years later is quite different, with Māori people being over-represented in the lower echelons of social statistics such as income, education, health, home ownership and incarceration. Efforts have been made to provide opportunities for Māori tribes through a Treaty settlement process, which began in the 1970s and is still in progress today.

An example of a tribe (known as Iwi) who has completed their settlement process and developed into a significant business entity is Ngāi Tahu, a Māori tribal organisation from the South Island of New Zealand. Ngāi Tahu have been recognized in law as having mana whenua (recognition and rights as the original inhabitants of the land) over most of the South Island, including the Southern Lakes area where most of New Zealand’s hydro electricity is generated. Ngāi Tahu completed their Treaty settlement in 1998 and in the years since have developed major commercial interests with over one billion NZD invested in seafood, forestry, farming, tourism, and property.

The mission of a Māori entity such as Ngāi Tahu is to provide support for their members and to uphold their people and culture. With an active investment arm and legal recognition as a treaty partner to be consulted in environmental and significant developments occurring in their area, Ngāi Tahu would be in a ready position to invest or become involved in activities such as Bitcoin Mining.

A phrase which many Māori groups use to summarise their aspirations is tino rangatiratanga. This phrase is included as one of the guarantees to Māori in the 1840 Treaty of Waitangi, translated, it means “absolute sovereignty” and should need no further explanation to Bitcoiners.

The development of circular economies, self-sovereign Māori Bitcoin banks or Fedimints etc, and other Bitcoin-related technology could be very empowering for a people who may have a historically challenging relationship with the state.

However it should be noted that New Zealand is overall a highly integrated society and schools, churches, sports, and other community aspects share many common cultural connections and enjoy widespread joint participation whether Māori or non-Māori. Employment and growth opportunities developed by the tribes also extends well beyond, with Ngāi Tahu for example employing many non-Māori through its business operations.

Many of the Māori Iwi have significant access to energy and natural resources and already have partnerships in place related to power generation, such as the Ngātamariki geo-thermal power station together with Mercury Energy.

Though there are many Māori Bitcoiners in New Zealand, some Iwi leadership may have been burned in the past by crypto scam coins etc and are thus reluctant on Bitcoin, however with a clear strategy and vision laid out it could be a very prosperous opportunity.

Conclusion

Though there is no explicit support for Bitcoin at a political level in New Zealand yet, there are also no major commercial or regulatory barriers beyond some difficulty with gaining bank account access for Bitcoin businesses. 

Though the “welcome mat” has not been laid out at a policy level, New Zealand is definitely open for Bitcoin business. There are already a number of Bitcoin startups and ventures running as well as Bitcoin mining operations.

Bitcoin mining could become a major export industry for New Zealand and the overall development of Bitcoin infrastructure and awareness could help significantly grow employment and local wealth creation.

The self-sovereignty aspects for New Zealand Māori also presents some promising pathways, and the combination of this alongside Bitcoin mining in particular is a powerful opportunity given the amount of natural resources and energy assets that Māori tribes have in their custody.

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ENDS

For media inquiries or further information:

Cody Ellingham

The Transformation of Value: Bitcoin Podcast in New Zealand

twitter - @ttovpodcast 

email - hello@thetransformationofvalue.com

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