Clarification - crypto assets are neither currencies nor money

Questions regarding payment with so called cryptocurrencies are again being raised in public. The Bank of Slovenia has thus prepared some additional clarifications. Virtual currencies, or, more accurately, cryptoassets, are neither currencies nor money,* and cannot be defined as foreign currency. Similarly explains also the European central bank.

Concepts of this type are a form of unregulated digital representation of value or token that is neither issued nor backed by a central bank or a public authority. That being said, it is not illegal to accept crypto assets as a means of payment in Slovenia (or the EU). Those using crypto assets for payment are nevertheless advised to check in advance with regard to (any) fees and commissions that they would pay to this end.

If you use crypto assets as a means of payment for goods and services, under EU legislation you are not protected by any right to a refund, as for example you would be when making transfers from a payment account. Stakeholders in virtual currency schemes that facilitate the purchase (e.g. trade platforms), storage (e.g. digital wallet providers) and trading of crypto assets in Slovenia are not systemically regulated and supervised. This means that no authority licenses or supervises these entities from the perspective of the adequacy of their risk management (operational risk and cyber resilience are particularly relevant), the expertise of employees in providing the services in question, the adequacy of transactions with users, etc. In consequence, investors in crypto assets should be aware of the specifics of this type of investment, and should weigh up whether the risks taken up align with their personal preferences and investment objectives.

* Crypto assets are not electronic money. The latter is defined in the Payment Services, Electronic Money Issuance Services and Payment Systems Act (ZPlaSSIED), and is a regulated means of payment. Electronic money is most commonly seen in the form of prepaid stored value in a traditional currency (e.g. euros) in an account or on another medium (e.g. a payment card).