Montenegro Aims to Become Europe's Crypto Hub, Weak Regulations Impact Institutional Business
Montenegro has positioned itself in recent years as a crypto-friendly destination in Europe. Prime Minister Milojko Spajić expressed hopes of turning it into a global blockchain hub. However, the lack of a comprehensive legal framework, primarily relying on anti-money laundering provisions, limits its ability to attract institutional investors. Lana Vukmirović Mišić, a senior partner at law firm JPM Partners, pointed out that a client intending to establish a crypto payment service provider in Montenegro abandoned the project due to regulatory gaps. Montenegro is expected to incorporate cryptocurrencies into regulation through amendments to its anti-money laundering law by early 2025, establishing registration requirements for service providers and oversight by the Capital Market Authority (CMA). However, this registration mechanism does not meet the licensing or authorization requirements of the EU's MiCA framework. Research by the Balkan Investigative Reporting Network (BIRN) shows that from the end of 2021 to the end of 2022, approximately $2.17 billion in cryptocurrency transactions were completed through digital wallets associated with Montenegro, with many transactions occurring outside regulation through unregistered street traders and Telegram groups. As part of its EU accession process, Montenegro needs to align its crypto asset regulations with frameworks like the EU's MiCA. Currently, public awareness of cryptocurrencies in the country is low, with surveys indicating that over 93% of Montenegrins know little about cryptocurrencies.
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