The government of Turkiye is working on a regulatory framework for cryptocurrency trading and service providers. The Finance Minister’s office of the region has stated that the legislators are preparing a framework that aligns with the requirements of the Financial Action Task Force (FATF).
At the same time, regulators are also working on legally translating complex concepts in crypto investment for licensing purposes. Mehmat Simsek is the Turkish Minister of Treasury and Finance who shared some of the details regarding the regulatory development of the cryptocurrency sector.
At the same time, the state also revealed the plans to add cryptocurrency service providers within the legal framework. Simsek told a local media outlet that the regulatory framework for the crypto industry is in the final stages of development. The minister noted that at present legislators are finalizing the technical aspects of legislative implementation and assessing its impact.
The ministry noted that the aim of the regulators is to mitigate associated risks for retail investors by ensuring compliance with international standards. The firm noted that the latest changes are to opt out of the FATF gray list.
Crypto Trading Platforms to Acquire License Under New Regulatory Rules in Turkiye
The latest regulatory changes will mandate cryptocurrency trading platforms operating in Turkiye to file for a Capital Markets Board (CMB) license. At the same time, the legislators are also set to add cryptocurrencies as a legally qualified asset. The same legal definition is also extended to various cryptocurrency-based entities such as digital wallets, services providers, custodial options, and trading forums.
Simsek also presented an example of the legal definition of crypto-based products and services. He defined them as intangible assets that are generated and stored in a digital manner with the help of distributed ledger technology (DLT) or similar networks.
These digital entities have the ability to express propriety rights or exchange value. Simsek further stated that the current regulatory framework is not about taxation requirements for virtual currencies. The authorities in Turkiye have been working on a regulatory framework for the crypto industry with an emphasis on registration and taxation.
Chainalysis, a blockchain intelligence firm reported that during 2022 and 2023, the region ranked as the 4th largest in terms of cryptocurrency trading volume around the globe. The report cited a $170 billion in aggregate trading volume. At the same time, the report ranked the USA, India, and the UK as the top 3 nations in terms of the same metric.
Turkish Central Bank Retains Friendly Position on Crypto Regulations
The Central Bank of Turkiye published the ‘Regulations on Disuse of Crypto Assets in Payment’ bill last year. The bill prohibits the use of cryptocurrencies as a mode of payment within the region. However, the federal agency has refrained from imposing a strict ban on crypto trading.
As per various reports, the region has continued to rank as one of the highest in terms of cryptocurrency adoption and trading volumes. On this account, various banking giants hailing from the Turkiye have introduced cryptocurrency-based services.
In the pretext of the new regulatory framework, major banking firm Akbank has announced the acquisition of a local crypto trading platform namely Stablex. Another banking behemoth Garanti BBVA has also launched a crypto custodial wallet in the form of an app. The wallet offers cold storage services that allow investors to trade Bitcoin, Ethereum, and various stablecoins.