Author: Ermira H. Kalaj, PhD.
Date: 22-11-2025
Cryptocurrencies are often celebrated as engines of innovation, tools that democratize finance, enhance transparency, and support new economic opportunities. Yet, beneath the promise of decentralization lies a rapidly evolving “digital underworld,” where virtual assets have become a powerful instrument for laundering illicit money. Nowhere is this shift more visible, and more concerning, than in Southeastern Europe (SEE), a region defined by structural inequalities, persistent informality, and fragmented regulatory oversight.
During my Short-Term Scientific Mission (STSM) at the University of Alcalá, I conducted a structured and systematic literature review that maps cryptocurrency-enabled money laundering (CAML) across the SEE region. The work synthesizes nearly 1,200 academic studies, policy reports, and investigative sources, resulting in a curated evidence base of 85 high-relevance documents. The findings suggest that while SEE is not unique in facing crypto-laundering risks, its vulnerabilities make it fertile ground for misuse.
Cryptocurrency in the Balkans did not emerge in isolation. It entered economies long shaped by cash transactions, informality, and remittance corridors that stretch from Western Europe to the smallest towns in Albania, Kosovo, and Bosnia and Herzegovina. It encountered a digitally curious youth population eager to experiment with new financial tools, alongside institutions that are still building the capacity to manage traditional financial crime, let alone its digital variants. Against this backdrop, crypto did not introduce entirely new criminal behaviors but offered an upgraded set of tools for long-standing laundering methods.
Criminal actors in the region make frequent use of mixers and privacy coins to obscure the origins of illicit funds. Unregulated foreign exchanges, chosen specifically for their permissive customer-identification practices, appear repeatedly as entry points for laundering. Increasingly, cross-chain transfers and stablecoin conversions are also layered into these schemes, allowing criminal networks to hide transactions behind multiple blockchain environments. These typologies, while similar to global trends, gain a unique dynamism in a region where institutional oversight is uneven and digital literacy among regulators is still developing.
Country-specific realities provide an extra layer of intricacy. Albania faces the dual challenge of a vibrant informal sector and high remittance inflows, while Serbia’s fast-growing crypto market coexists with limited detection of suspicious digital transactions. North Macedonia remains largely invisible in official reporting, not necessarily because the risks are low, but because its supervisory capacities are insufficient to observe them. Montenegro’s combination of a euroized economy and permissive corporate practices creates fertile ground for regulatory arbitrage. Bosnia and Herzegovina’s fragmented governance structure hinders coordination across institutions, and Kosovo’s rapid digital adoption, including a once-booming mining sector, heightens exposure in the absence of strong oversight. Each territory has its own vulnerabilities, yet they collectively create a regional environment in which illicit actors can easily move from one regulatory gap to another.
Advanced blockchain-analytic tools exist, but the FIUs and law-enforcement bodies in many SEE countries lack the resources, training, and institutional frameworks to use them effectively. Investigations often remain reactive rather than preventive, influenced by foreign intelligence inputs or investigative journalism rather than systematic monitoring. Meanwhile, corruption and political interference, persistent issues across the region undermine the effectiveness of even well-designed legal frameworks.
Advanced blockchain-analytic tools exist, but the FIUs and law-enforcement bodies in many SEE countries lack the resources, training, and institutional frameworks to use them effectively. Investigations often remain reactive rather than preventive, influenced by foreign intelligence inputs or investigative journalism rather than systematic monitoring. Meanwhile, corruption and political interference, persistent issues across the region undermine the effectiveness of even well-designed legal frameworks.
The region is slowly moving towards regulatory alignment with EU standards. Technical assistance, cross-border cooperation, and increased awareness of virtual asset risks are beginning to elevate the conversation from one of crisis response to one of capacity building. What remains essential is not simply adopting the legislation of advanced jurisdictions, but ensuring that institutions across SEE have the tools, skills, and independence to apply it effectively.
The future trajectory of cryptocurrency in the Balkans will be determined not by the speed of technological change, but by the region’s ability to strengthen governance, build institutional resilience, and enhance cross-border coordination. Without these efforts, SEE risks becoming an increasingly attractive hub for illicit digital finance. With them, the region has the potential to transform vulnerability into opportunity and to position itself as an active contributor to Europe’s evolving Anti Money Laundering architecture.
The future trajectory of cryptocurrency in the Balkans will be determined not by the speed of technological change, but by the region’s ability to strengthen governance, build institutional resilience, and enhance cross-border coordination. Without these efforts, SEE risks becoming an increasingly attractive hub for illicit digital finance. With them, the region has the potential to transform vulnerability into opportunity and to position itself as an active contributor to Europe’s evolving Anti Money Laundering architecture.
