Cryptocurrency production, known as “mining,” is now allowed in Kosovo only when alternative sources of electricity are used, in accordance with the liberalization of the energy market. The activity remains prohibited for those supplied by the public universal grid.

This was confirmed to the “Shtylla” program, produced by KosovaPress, by former chair of the parliamentary Working Group on the Law on Crypto Assets, Mimoza Kusari-Lila. She said that the ban on mining for those using electricity from the universal grid remains in force, and the only exemption is if operators secure other sources of electricity, including from the liberalized energy market.

To clarify whether mining is now officially allowed for those supplied by the liberalized market, KosovaPress sent official questions to the Ministry of Economy, but has not yet received a response. On January 4, 2022, then-Minister Artane Rizvanolli wrote that, based on the recommendation of the Technical Committee on “Emergency Measures in Energy Supply,” she had decided on Emergency Measures prohibiting cryptocurrency production throughout the territory of Kosovo.

Last autumn, the Assembly of Kosovo approved the Law on Crypto Assets, but its full implementation depends on the Central Bank of Kosovo (CBK), which must establish a special unit to supervise and regulate this sector. To determine the status of this process, KosovaPress sent questions to the CBK, but they have not responded.

Deputy Kusari-Lila says that mining is not allowed if it involves electricity supplied from the universal grid. However, she explained that the only exemption for mining is if businesses or operators manage to secure other sources of electricity, including from the liberalized market.

“The Law on Crypto Assets is now in force. It was approved in two readings in the previous legislature within the regular timelines. Full implementation of the law is the responsibility of the CBK, which must establish a special unit and all responsible personnel to supervise the market and the operation of crypto assets. Mining is not allowed if it involves electricity from the universal grid, while the only exemption is if businesses or operators manage to secure other sources of electricity, including from the liberalized market. With energy market liberalization, if supplied from outside the public system, mining can be conducted, but not under the current general supply system. The CBK has been in the process of forming the unit; how far they have progressed, I cannot say, because the Assembly and functional commissions have not yet been fully established to oversee the law’s implementation,” Kusari-Lila stated.

Regarding the law’s implementation, cryptocurrency technology expert Milot Mehmeti expressed skepticism about the CBK’s role, emphasizing that the bank sees this sector as a competitor and is not supporting its independent regulation.

(It has gone down the wrong path, because the CBK sees it as a competitor)… They will push to regulate it in ways that suit their interests. There should have been an independent working group to advance the sector and guide cryptocurrencies where they need to go. The CBK is the opposite of what cryptocurrencies aim to achieve. Cryptocurrencies are designed to remove intermediaries like the CBK. That is, they are created so we do not have an entity controlling a tool we use for exchange. It is fine for the CBK to be involved to the extent that transfers are accepted only through banks, which must comply with AML and KYC rules, and everything is in order,” Mehmeti explained.

He also warned about the risks of cryptocurrencies, noting that “cryptocurrencies are not safe, as they are often used for scams and financial abuse.” Nonetheless, he said that cryptocurrency technology challenges traditional banking systems and could fundamentally change how the global financial system operates.

“Cryptocurrencies in general are not safe, because people use them for fraud, whatever the method. Cryptocurrencies have been used and are still used for various scams. Over time, some people have become millionaires from crypto investments because it is a new field. Certainly, they challenge banks. Any old system… Banks worldwide are adopting cryptocurrencies and using them as a technology to perform cross-border transactions, avoiding big fees and logistical obstacles. Just as email replaced the post, cryptocurrencies will replace banks because we don’t need human entities to tell us what to do,” Mehmeti said.

In global news, Bitcoin fell 8% in August, dropping to just over $108,000, about 13% below its record of over $124,000 on August 13. The price is now slightly below the Memorial Day level of $109,500.