Turkey is among the countries in the world where cryptocurrencies have enjoyed the most popularity over the recent years. However, in April 2021, the central bank issued a directive that led to the prohibition of the use of digital assets for payments. The measures were taken after a significant depreciation of the Turkish lira that reached 15%. Following the ban, Ankara amended the crypto regulations and coin exchanges were included to a list of entities governed by its anti-money laundering rules.

The government is planning to impose regulations similar to those that are being introduced in Europe and the US, although a “little more stringent” according to the Deputy Minister of Treasury and Finance Şakir Ercan Gül. He’s also stated that a draft law aiming to strengthen investor protection has been prepared. Furthermore, it will prevent dirty money laundering, and will improve the control over cryptocurrency trading. The Financial Crimes Investigation Board will have the task to establish a surveillance mechanism for consumer protection, protecting the market integrity and fair competition.

The new bill will be submitted to the parliament In October 2021. Similar to some European jurisdictions, the Turkish government intends to tax cryptocurrency holdings above a given threshold. Various proposals will be reviewed, including the introduction of mandatory reporting for crypto transfers (over a certain value) to the country’s tax office.

The legislation will introduce definitions of the different types of crypto assets and will establish regulations related to the issuance and distribution of digital coins. The draft law lists key principles traders should adhere to and conditions which crypto platforms will have to meet so they can provide custodial services for digital currencies. Companies that deal with crypto-assets will be supervised by the Capital Markets Board and they will have to meet a set of requirements such as minimum capital holdings. All the businesses will be given time in order to adapt to the new regulatory framework.

The news can be interpreted as being positive overall as it would mean that the Turkish authorities do not plan to completely ban cryptocurrencies like some other countries in the world have (for instance Vietnam). People who are thinking of trading on legitimate cryptocurrency exchanges such as Binance will be able to do so care-free.

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