What does the Central Bank’s ban on cryptocurrency payments mean? What do experts and investors say about it?

According to the regulation by the Central Bank of the Republic of Turkey (CBRT), crypto assets cannot be used directly or indirectly in payments. So, what does the CBRT’s recent decision mean? Has cryptocurrency been banned in Turkey? How are investors evaluating this decision?

With traditional investors worldwide, especially turning to crypto currencies such as Bitcoin, the cryptocurrency market is experiencing record levels of trading volume. Major companies have announced that they will conduct transactions through cryptocurrency.

In recent years in Turkey, there has been a significant increase in demand for cryptocurrency following fluctuations in financial markets. However, according to the regulation by the Central Bank of the Republic of Turkey (CBRT), crypto assets cannot be used directly or indirectly in payments.

So, what does the CBRT’s recent decision mean? Is cryptocurrency been banned in Turkey? How are investors evaluating this decision? Why did the CBRT make a decision on cryptocurrency?

In the CBRT’s statement, areas where making payments with cryptocurrency is considered risky for the parties involved were listed as follows:

1. Cryptocurrencies are not subject to any regulation and oversight mechanism.
2. There is no central counterparty.
3. Market values ​​show excessive volatility.
4. There is a risk of being used in illegal activities due to their anonymous structures.
5. There is a possibility of wallets being stolen or used improperly without the owners’ information
6. Transactions are irreversible in nature.

What is the purpose of the regulation?

According to the CBRT’s Regulation on Non-Use of Crypto Assets in Payments, which came into effect on April 30th: The regulation aims to determine the principles and procedures for not using crypto assets in payments, not using crypto assets directly or indirectly in the provision of payment services and the issuance of electronic money, and not mediating payment and electronic money institutions in services such as buying and selling, storage, transfer, or export of crypto assets, or fund transfers from these platforms.