Understanding Cryptocurrency And Distributed Ledger Technology in the Albanian Legal Context

Understanding Cryptocurrency And Distributed Ledger Technology in the Albanian Legal Context

October 2021

Blockchain represents one of the 21st century’s most impactful inventions. In addition to creating cryptocurrencies such as Bitcoin, this technology enables smart contract functionality and supports decentralised, secure, and private transactions. By design, blockchains enable decentralised functionality for many of today’s business applications and transform traditional centralised information systems. In a few chapters, KALO & ASSOCIATES will summarise the legal and regulatory developments of crypto and blockchain in Albania by explaining what they are, what they are not, and where they might go from here. 

The first chapter explains what a Distributed Ledger Technology (“DLT”) is and its difference with Blockchain.

The second chapter discusses the legal and regulatory framework of Albania regarding financial markets based on DLT and the main institutions in charge of the enforcement of such a legal framework. In this note, it is explained which activities are subject and conditioned to licensing, monitoring and supervisory activities, etc.

The third chapter explains two very important concepts of the Law “On financial markets based on the technology of Distributed Ledgers”, the Initial Coin Offering which is the cryptocurrency industry’s equivalent to an initial public offering (IPO), and the Security Token Offering which is basically a type of public offering in which tokenised digital securities, are sold in cryptocurrency exchanges, or security token exchanges.

The fourth chapter of our paper on the financial market is based on Distributed Ledger Technology: Distributed Ledger Technology Stock Exchange and the licenses issued by the Authorities.

The fifth chapter is about some of the remaining features introduced through the Albanian DLT Law such as Innovative Technology Arrangements; Third-Party Wallet Custodians and Automated enterprises of collective Digital Token investment.

October 2021

Blockchain represents one of the 21st century’s most impactful inventions. In addition to creating cryptocurrencies such as Bitcoin, this technology enables smart contract functionality and supports decentralised, secure, and private transactions. By design, blockchains enable decentralised functionality for many of today’s business applications and transform traditional centralised information systems. In a few chapters, KALO & ASSOCIATES will summarise the legal and regulatory developments of crypto and blockchain in Albania by explaining what they are, what they are not, and where they might go from here. 

The first chapter explains what a Distributed Ledger Technology (“DLT”) is and its difference with Blockchain.

The second chapter discusses the legal and regulatory framework of Albania regarding financial markets based on DLT and the main institutions in charge of the enforcement of such a legal framework. In this note, it is explained which activities are subject and conditioned to licensing, monitoring and supervisory activities, etc.

The third chapter explains two very important concepts of the Law “On financial markets based on the technology of Distributed Ledgers”, the Initial Coin Offering which is the cryptocurrency industry’s equivalent to an initial public offering (IPO), and the Security Token Offering which is basically a type of public offering in which tokenised digital securities, are sold in cryptocurrency exchanges, or security token exchanges.

The fourth chapter of our paper on the financial market is based on Distributed Ledger Technology: Distributed Ledger Technology Stock Exchange and the licenses issued by the Authorities.

The fifth chapter is about some of the remaining features introduced through the Albanian DLT Law such as Innovative Technology Arrangements; Third-Party Wallet Custodians and Automated enterprises of collective Digital Token investment.