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    • Aug 2, 2022
    • 3 min read

Turkish cryptocurrency laws in 2022

Many Turkish residents have entered the cryptocurrency markets to safeguard the value of their money and thereby their purchasing power as a result of the country's economic inflation and increasing exchange rates. Due to its numerous benefits, including low transaction costs, 24/7 transaction availability, and convenience of international money transfers, cryptocurrencies and associated exchange platforms have recently attracted the attention of many domestic and international investors. The situation of cryptocurrencies under Turkish law and the corresponding legislation will be discussed in the sections that follow.


Initial Efforts to Legalize Cryptocurrencies

The "The Regulation on Prohibiting Payments with Crypto-Assets" (the "Regulation"), which was issued in the Official Gazette on April 16, 2021, established the basic legal framework for cryptocurrencies in Turkey. The Central Bank of the Republic of Turkey ("CBRT") forbids the use of crypto assets as a payment method in legitimate transactions by this rule. But none of its articles discuss trading in digital assets. Additionally, the Regulation is groundbreaking since it offers the first definition of "crypto assets." The definition of crypto assets in Article 3 of the regulation is as follows: "In the implementation of this Regulation, crypto assets are defined as assets created virtually using distributed ledger technology or a similar technology and distributed over digital networks, but are not considered to be money, fiat money, or any other form of legal tender.


  • The following is prohibited in Turkey:

  • Use of cryptocurrencies in payments, either directly or indirectly.

  • Delivering services for the direct or indirect use of cryptocurrency in payments.

  • Giving platforms that trade, deposit, transfer, or issue services related to digital assets, or that allow for fund transfers from these platforms, access to intermediary services from payment and electronic money institutions.

  • Development of business models allowing the use of cryptocurrency assets, directly or indirectly, in the delivery of payment services and the issuance of electronic money, as well as the provision of any services by payment service providers related to such business models, by payment service providers.

Authorities' positive outlook on the rise of cryptocurrencies.

Regulations and public declarations up until this point have always sought to prohibit or curtail cryptocurrency use. The initial draft of the crypto currency law was released towards the end of December 2021. The following were the highlights of the draft:


  • A change to the Capital Market Law that addresses cryptocurrencies

  • the initial definitions of terms like "crypto asset," "crypto asset trading platform," "crypto asset custodian," and "crypto asset service providers"

  • The Capital Market Board's power to choose the digital assets that will be traded on platforms, to control when trading is to end, to decide what to do with the digital assets for which trading has ended, and to approve the operation of crypto platforms and service providers

The proposed law, however, as well as any connected laws, have not yet been adopted.


President Recep Tayyip Erdogan said on January 7, 2022 that TOGG, the native vehicle brand of the Republic of Turkey, will collaborate with the AVAX cryptocurrency network following a meeting with Elon Musk, the CEO of the Tesla firm. In addition, the President declared on January 26, 2022, that Turkey ought to be among the top nations in the Metaverse.


Conclusion

Given cryptocurrencies' quickly rising global appeal, it appears that Turkey, like other nations, has started establishing the legal framework and foundations for them. However, it appears that it will take some time to define the legal nature of these assets and determine the frameworks of legislation to manage these assets given the autonomous, decentralized, and unregulated nature of cryptocurrencies.





Information from the following author and Website:
https://www.gvw.com/en/news/blog/detail/turkey-current-regulations-on-cryptocurrencies-under-turkish-law


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