Turkey has introduced a crypto bill to regulate the cryptocurrency market in line with international standards. The proposed legislation covers virtual asset service providers, trading platforms, asset storage, and transactions conducted by Turkish residents. All cryptocurrency service providers operating in Turkey will be required to obtain licenses and register with the Capital Markets Board (CMB), the financial regulator. The bill also grants the CMB expanded authority to safeguard consumer assets held by crypto service providers and tasks the CMB with enforcement capabilities for revenue collection. The government seeks to foster a locally regulated ecosystem by prohibiting foreign crypto brokers from operating in Turkey without the necessary licenses and adherence to the regulations, aligning the country’s crypto regulations with FATF standards, including the “Travel Rule” mandating accurate information collection and sharing in digital asset transactions.
Turkey’s move to strengthen its crypto regulations follows the country being placed on the FATF’s “gray list” in October 2021 due to inadequate implementation of AML measures across various sectors. The need for regulation increased in late 2022 as part of a plan to protect the Turkish lira from intrusion by cryptocurrencies. This initiative faced opposition from Turkey’s crypto communities, leading to a media outcry and subsequent engagement between government officials and crypto communities to address concerns and develop a more inclusive regulatory framework. Despite initial backlash and postponement of the introduction of a formal bill, Turkish authorities have now proposed a comprehensive crypto regulatory framework aligned with FATF guidelines to balance citizen concerns with fostering a secure and reliable crypto market.
The Turkish government’s priority is consumer protection and compliance with global standards in the crypto industry. The proposed bill aims to regulate various aspects of the crypto market, including virtual asset service providers, trading platforms, asset storage, and transactions conducted by Turkish residents. Cryptocurrency service providers in Turkey will be required to obtain licenses and register with the Capital Markets Board (CMB). The CMB will have expanded authority to safeguard consumer assets held by crypto service providers and enforce revenue collection. The bill also prohibits foreign crypto brokers from operating in Turkey without the necessary licenses and adherence to the regulations, aligning Turkey’s crypto regulations with FATF standards.
The draft crypto bill in Turkey incorporates the FATF’s “Travel Rule,” which mandates accurate information collection and sharing in digital asset transactions to combat money laundering and terrorist financing. The proposal aims to bring Turkey’s crypto regulations in line with international standards set by the FATF. The country’s move to strengthen its grip on the crypto market follows concerns raised by the FATF regarding inadequate implementation of AML measures in various sectors. The Turkish government aims to balance the needs of citizens and foster a secure and reliable crypto market by introducing comprehensive regulatory framework aligned with FATF guidelines.
Turkey’s decision to regulate the crypto industry follows a period of public outcry and engagement with Turkish crypto communities to address concerns and develop a more inclusive regulatory framework. Despite initial opposition and postponement of introducing formal legislation, Turkish authorities have now proposed a comprehensive regulatory framework aligned with FATF guidelines to balance citizen concerns with fostering a secure and reliable crypto market. The government’s priority is to protect consumers and ensure compliance with international standards in the crypto industry, with provisions in the bill covering various aspects of the market, including service providers, trading platforms, asset storage, and transactions conducted by Turkish residents. The proposed legislation aims to align Turkey’s crypto regulations with global standards while addressing concerns raised by the FATF regarding AML measures.
