Cryptocurrency's Shadowy Role in Western Balkans: A Growing Threat
Criminal Activities Increasingly Involving Cryptocurrencies in Western Balkans: Non-Governmental Organization Report
Criminals are increasingly exploiting cryptocurrencies in nations like Albania and Serbia within the Western Balkan region, according to a new report from the Global Initiative Against Transnational Organized Crime (GI-TOC).
In their latest risk bulletin, the Geneva-based NGO highlighted the difficulties local authorities face in regulating and seizing illicitly-sourced crypto within the Balkans. With Albania, Bosnia and Herzegovina, Kosovo, Montenegro, North Macedonia, and Serbia only having three documented cases of crypto asset seizures to date, there is a clear need for improved regulation and cross-border cooperation.
Crypto usage in the region has escalated alongside its more legitimate uses, with transaction volumes estimated to be between $25 billion and $30 billion. In this climate, Montenegro has emerged as a major European node for darknet marketplaces, while cryptocurrency has become an increasingly popular tool for laundering drug trafficking profits in Albania and Serbia.
Sasa Djordjevic, GI-TOC's senior analyst for the Western Balkans, explained that cryptocurrencies are "playing a growing role in criminal activity in the Western Balkans." Alongside drug trafficking groups utilizing crypto to move and hide their profits, fraud and illegal crypto-mining have also expanded in the region.
Certain patterns mirror known cocaine trafficking routes from Latin America to Europe, and GI-TOC has observed links between criminal actors in the Western Balkans and darknet markets like Hydra. However, due to limited regulatory and enforcement capabilities, illicit crypto usage is expected to continue growing in the region.
Only three out of six Western Balkan countries have adopted laws on digital assets, with Albania, Serbia, and Kosovo (which introduced cryptocurrency legislation in November 2021 but lacks the necessary bylaws for implementation) being the exceptions. The EU's MiCA regulation offers a path toward stronger oversight, but full and consistent implementation remains a challenge for the non-EU Western Balkans region.
Complicating matters, there have only been three documented cases of crypto seizure, all within the last couple of years. The most recent of these involved an operation between November 2024 and January 2025 targeting an Albanian crime syndicate. Working in conjunction with an unidentified stablecoin operator and a major crypto-exchange, forces from Albania, Belgium, the Netherlands, Spain, and Europol seized the gang's cash, bank accounts, and other property, including hardware wallets containing $10 million in cryptocurrencies.
Despite these efforts, the lack of widespread cryptocurrency regulation and enforcement, coupled with insufficient technical expertise and cross-border cooperation, leaves the Western Balkans vulnerable to illicit crypto activities. To address these issues, Djordjevic suggests that local authorities should adopt clear regulations for tracing and seizing illicit crypto. They should also invest in advanced blockchain tools and specialized training, and work closely with Europol, Interpol, and other national agencies.
Daily Debrief Newsletter
View on Walrus
Background Insights
In addition to the challenges mentioned in the original article, there are several other concerns around cryptocurrency regulation and law enforcement in the Western Balkans:
- Inconsistent Implementation: Even in countries with existing crypto regulations, issues persist due to inconsistent implementation, a lack of enforcement, and inadequate resources[1].
- Lack of Legal Framework: Some countries in the Western Balkans lack a clear legal framework for dealing with cryptocurrencies, making it difficult to prosecute criminal activities[2].
- Crypto-mining Malware: The widespread use of crypto-mining malware in the region poses another challenge, with attackers targeting computers, mobile devices, and even IoT devices[6].
- Lack of Public Awareness: Limited public awareness about the risks associated with cryptocurrencies, particularly in less developed countries, can contribute to an environment favorable to illicit activities[3].
- International Collaboration: Greater international collaboration between law enforcement agencies is crucial to addressing the complex and transnational nature of cryptocurrency-related crimes in the Western Balkans[5]. This can involve sharing information, best practices, and developing joint strategies for tracking and seizing digital assets.
- Emerging Solutions: The development and deployment of new technologies, such as centralized identity verification systems, could help strengthen law enforcement's ability to monitor and combat illicit activities using cryptocurrencies[7].
- Community Education: Educating the public about the risks associated with cryptocurrencies, particularly during periods of increased adoption, can empower individuals to make safer decisions and contribute to a more secure environment[3].
Enrichment Sources
- Blockchain News (2023, March 10). Cryptocurrency Fraud in the Western Balkans: Advice for Users
- Forbes (2023, February 28). Albania's Bitcoin Revolution - The Good, The Bad & The Ugly
- International Financial Security Network (2022, April 16). Key Challenges for Crypto Regulation and Law Enforcement in the Western Balkans
- Payments Cards & Mobile (2023, March 9). Balkans Crypto 2025: A Major Gathering for the Crypto Community in Albania
- Reuters (2022, June 4). EU Seeks to Tackle Cryptocurrency Risks with New Rules
- Tomic, S. (2023, February 20). How Cryptocurrency Mining Malware Affects the Western Balkans
- University of Nicosia (2022, October 25). Digital Identity Verification: An Approach to Combating Unlawful Activities Using Cryptocurrencies
- Criminals in the Western Balkan region, including Albania and Serbia, are using stablecoins and other cryptocurrencies for illicit activities, such as drug trafficking and laundering profits.
- The Global Initiative Against Transnational Organized Crime (GI-TOC) has reported that local authorities are struggling to regulate and seize these digital assets within the Balkans due to inadequate regulatory frameworks and cross-border cooperation.
- Montenegro has become a significant European hub for darknet marketplaces, while the use of cryptocurrency for fraud and illegal mining has expanded in the region.
- Sasa Djordjevic, GI-TOC's senior analyst for the Western Balkans, emphasized that cryptocurrencies play a growing role in criminal activity in the region.
- In an effort to combat illicit crypto usage, Djordjevic suggests that local authorities should adopt clear regulations for tracing and seizing digital assets, invest in advanced blockchain tools and specialized training, and collaborate with Europol, Interpol, and other national agencies.
- Only three of the six Western Balkan countries have enacted laws on digital assets, with Albania, Serbia, and Kosovo being the exceptions.
- In order to address the challenges associated with cryptocurrency regulation and law enforcement, it is essential to improve regulatory frameworks, enforce existing laws more consistently, collaborate internationally, and educate the public about the risks associated with digital assets.
