Ditching Dinars: Will the Balkans Take to Cryptocurrency?

Knowledge and experience are not enough, however. Regulations are required to ease the burden on companies working in the field, experts say.

“Several companies from this area are working on top notch cryptocurrency projects: like in DeFi, second layer protocol solutions for scaling of payment networks, blockchain based protocol for tokenisation of assets, but again it is hard to keep them here,” said Kamberi.

“We would need proactive, positive regulation in order to ease the burden of such start-ups and IT companies.”

One success story that others might try to emulate is Slovenia.

“Slovenia implemented crypto friendly regulations and this boosted the industry and the use of cryptocurrencies,” said Kamberi. “The country now has more than a thousand places in which you can spend cryptocurrencies – including major retailers like ‘Tuš’ or Burger King Slovenia.”

Serbia also seems ready and willing to adopt a set of crypto-regulations which would address cryptocurrency trading.

Belgrade-based Electronic Currency District, ECD, is a Bitcoin exchange that launched in 2012. Since then, their service has evolved and also opened branches across the region, the company told BIRN.

“We have added five new cryptocurrencies, we set up a network of Crypto ATMs in Serbia, developed application for bitcoin payments and opened branches in [North] Macedonia and Montenegro,” said co-founder and CEO Aleksandar Matanovic.

Currently the greatest potential in is remittances, Matanovic told BIRN.

“Remittances are probably the biggest chance for crypto to be used as money. The Balkans is a huge remittance market and sending money internationally is both faster and cheaper if you use crypto.”

“With a supportive regulatory framework, I really believe this industry could flourish, beneffiting not only those directly involved but also society as a whole.”

Some countries playing catch-up

Unlike Slovenia, Croatia, or Bulgaria, countries like North Macedonia are lagging behind, mostly due to the lack of any regulations whatsoever. And for those in the country looking to do business in cryptocurrency, it’s not straightforward.

“Trading mainly works through several crypto exchanges, most often Binance, and there are no obstacles here. Profit and exchange in denars usually goes through intermediaries, EU or Bulgarian residents,” said Petar Grujoski, a Skopje-based cryptocurrency enthusiast.

“Until recently, Macedonian citizens were not allowed to have accounts abroad, and we still do not have PayPal and Amazon for the same reason,” Grujoski told BIRN.

Cryptocurrency mining, on the other hand, can prove highly profitable in North Macedonia, not least because of cheap electricity supplies. The same applies to the rest of the region. But sometimes, when it comes to cryptocurrency mining and the rest of the infrastructure that can support the use of this technology, there are still some doubts.

“Regarding the infrastructure, if we look at the mining industry, electricity is in abundance and still quite cheap in some areas,” Kamberi said. “But mining can be a real environmental threat and the focus should be moved away from incentivising such an industry.”

“Regarding the use and payments infrastructure, the Internet coverage is still an issue in some areas. Anyhow, the ability to access the cryptocurrency payment networks using mobile devices and 3G connection makes it easier for users even in the most remote parts of the region.”