The Turkish government is putting the finishing touches on long-awaited cryptocurrency regulations. According to Finance Minister Mehmet Şimşek, the technical aspects of the new rules are now being finalized after an extensive development process.
The regulations take a broad approach to governing crypto assets and aim to boost investor protection while allowing the industry to flourish.
Keypoints
- Turkey is in the final stages of developing crypto asset regulations
- Crypto platforms will be required to obtain licenses from Turkey’s Capital Markets Board
- The regulations define critical concepts like “crypto assets,” “crypto wallets,” “crypto asset service providers,” etc.
- The rules aim to reduce risks for crypto investors and align with international standards like FATF
- Crypto taxation is being studied separately and is not part of the upcoming regulations
The draft legislation contains detailed definitions of key terminology related to digital currencies. Crypto assets are defined as “intangible assets that can be created and stored electronically using distributed ledger technology or a similar technology.”
The rules also define concepts like crypto wallets, trading platforms, custody services, and more. Sources indicate that Turkey aims to future-proof the regulations to account for innovation in the rapidly evolving crypto space.
A major component of the regulations requires crypto trading platforms and service providers to obtain operating licenses from Turkey’s Capital Markets Board (CMB).
Firms will need to meet minimum standards around organization, capitalization, infrastructure, and more – similar to requirements already in place for financial institutions. The creation of clear licensing rules aims to increase accountability and reduce risks for crypto investors.
The overall goal is to eliminate ambiguity around the legal status of cryptocurrencies in Turkey. By defining digital assets in law and creating a compliance framework for trading venues, regulators hope to encourage growth of legitimate platforms and protect everyday investors.
The government also plans to comply with guidelines set out by the global anti money laundering watchdog, the Financial Action Task Force (FATF).
While taxation of crypto income will require separate legislation, Turkey’s comprehensive regulatory approach mirrors a worldwide push towards creating legal certainty around digital currencies.
As crypto adoption accelerates globally, establishing rule of law could be key for countries hoping to reap the benefits of blockchain innovation. With its new regs, Turkey seems ready to lead that charge.
