Turkey Bans Cryptocurrency Payments

Turkey Bans Cryptocurrency Payments

access_time2021-04-16 15:13:35


The Turkish central bank banned the use of cryptocurrencies as a form of payment from April 30, saying the level of anonymity behind the digital tokens brings the risk of “non-recoverable” losses.

The curbs also prohibit companies that handle payments and electronic fund transfers from processing transactions involving cryptocurrency platforms, according to a decree published in the official government gazette on Friday.

A lack of regulation, supervision mechanisms or central regulatory authority, combined with the potential for criminal activity and the high volatility of their market value, mean digital tokens entail “significant risks,” the central bank said in a statement  on its website.

 

In March, the Treasury and Finance Ministry said  it shared the “global concern” about the development of cryptocurrencies. The ministry signaled it was working on regulations in cooperation with the central bank, the banking regulator and Turkey’s capital markets board.


Complaints from Turks mentioning cryptocurrencies soared  by 8,616% in February from a year earlier, according to data from consumer forum Sikayetvar.

Bitcoin has surged 111% this year to trade above $60,000, while ethereum, the second-largest cryptocurrency, has jumped 225%.

More Turkish investors moved into cryptocurrencies, along with equities, as they cashed out of some of their foreign-exchange holdings after the unexpected removal of central bank governor Naci Agbal triggered a drop in the lira, Dunya newspaper reported  on April 5.

Trading volume in cryptocurrencies almost tripled to $2.8 billion between March 20-24, from about $1 billion in the same period last year, the newspaper reported, citing Chainanalysis data.

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