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Cryptocurrency trading has some surprising side effects. And the brain drain is just one of them

Aspiring entrepreneurs in the Balkans are hoping to cash in on the cryptocurrency craze – for better or worse.
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Written by Bojan Stojkovski, Contributor on
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Stories of self-made crypto millionaires create an irresistible allure, but it's an industry fraught with risk.

Image: tdub303 / GETTY

When 31-year-old marketing professional Tale Anastasov first heard how much money could be made mining cryptocurrency, it sounded almost too good to be true. But when his friend sold his apartment and purchased dozens of crypto-mining rigs in 2020, Anastasov decided to get in on it.

"I bought two crypto-mining rigs for €3,000 each, hoping that this investment could soon make me a passive income of around €500 a month. I was mining Ethereum, which at the time had a price of around €300," Anastasov tells ZDNet

Having bought the mining rigs in October 2020, during the next few months, Ethereum's price nearly doubled.

"In December, the price of Ethereum increased to €600, and already in January 2021, it was more than €1,600. By April, my investment had already paid out. Then I invested again and spent around €15,000 on four mining rigs," Anastasov says.

SEE: The future of money: These innovations will change how we shop, spend and save

Originally from the small town of Veles in North Macedonia, Anastasov now lives in the country's capital of Skopje. For a country where the average salary is just under €500 per month, many young Macedonians – like Anastasov – are looking to the crypto world as an opportunity to make considerably more money than they'd get from a regular full-time job.

Others, like Skopje-based fitness trainer Stefan Angelovski, have even quit their jobs to trade cryptocurrencies full-time. Tired of taking underpaid work, 34-year-old Angelovski has been working as a crypto trader for the past few years. Every morning he wakes up and logs onto the crypto stock market through apps like Binance or Coinbase to see what's happening.

"Crypto trading is what I do all day long, every day," he tells ZDNet. Angelovski says he hasn't seen a lot of success over the past year, but claims he now makes enough money through trading crypto to stop him needing a full-time job.

Much like the rest of the world, the crypto craze is sweeping the Balkans. Serbia, for example, is one of the few countries that have introduced regulations on cryptocurrencies, adopting laws in June last year that recognize them as virtual assets that can be purchased, sold, transferred and exchanged.

More importantly, they can be taxed. In Serbia, earnings gained through trading cryptocurrencies are considered capital gains and taxed at 15%.

Elsewhere across the region, shops and retail chains are beginning to accept payments in cryptocurrencies. Croatia's largest retail chain Konzum is one of the first to introduce this, looking to appeal to young and tech-savvy consumers and marking something of a next step in contactless payment methods.

"Although this payment method is still in its infancy in Croatia, we record cryptocurrency payments in our Konzum online shop almost every day," a Konzum spokesperson tells ZDNet. It could also help attract new employees interested in working with new technologies.

While cryptocurrency exchanges and ATMs are becoming a regular sight in the Balkans, most governments in the region still lack a clear regulatory framework to govern their use.

Bosnian entrepreneur Vedad Mesanovic believes regulators in Balkans only see digital currencies as a means to aggressively tax cryptocurrency traders, as opposed to an opportunity to stimulate growth in the economy and attract entrepreneurs and investors to the region.

New regulations could help change this, he tells ZDNet, but adds that "it will take some time" before countries like Bosnia and Herzegovina can position themselves to be crypto-friendly. State laws in these countries don't recognize cryptocurrency assets, meaning people who have invested in crypto through trading or mining can't withdraw their earnings.

Mesanovic believes that defining clear regulations could stimulate the adoption of new payment systems and business models in the country, powered by the blockchain. "This will enable Bosnia and Herzegovina to leverage modern technologies and opportunities to economically prosper in the years to come," he says.

There is no argument that cryptocurrencies are a serious business. Organizations are increasingly looking to the blockchain to underpin a new generation of digital payment services, and the sector can teach valuable skills in coding, trading and marketing.

SEE: Why should we care about cryptocurrency? The business case for taking a closer look 

Still, the current crypto market remains something of a Wild West, not least because the market is highly volatile. Bitcoin lost almost half of its value in January after hitting record highs in November 2021, wiping hundreds of billions of dollars off the cryptocurrency market. Ethereum, Cardano and other coins have seen similar volatility.

Jobs could also be impacted. North Macedonia is already suffering from a significant brain drain, with much of its highly qualified workforce migrating abroad to live and work. According to data from the country's latest census, more than 600,000 people have left the country in the past two decades.

The fact that young people are opting to mine or trade cryptocurrencies as opposed to working threatens to put a strain on domestic companies and leave them facing staff shortages.

"We already have a shortage of workforce, and this can only put an additional burden on domestic companies," Skopje-based economist Irena Cackova tells ZDNet. "Some of the young people in the country just aren't motivated to looks for jobs since they are earning well from crypto."

The practice of crypto mining also has a significant environmental impact. Balkan counties are already facing a severe energy crisis, with utility prices spiking across the region. In January, authorities in Kosovo banned all crypto-mining activities under emergency measures introduced to relieve the country's energy emergency. Arvin Kamberi, vice president of Serbia's Bitcoin association, describes crypto mining's energy impact as "a considerable e-waste threat."

These developments could force authorities to come down harder on cryptocurrency miners and traders, as examples from China and elsewhere have demonstrated.

Despite the risks, Angelovski remains undeterred. "My goal is to make enough money that can earn me interest," he says. "Then, I can be more relaxed about my trading."

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