The Central Bank of Turkey (CBRT) has confirmed via legislation published in the Official Gazette overnight, that cryptocurrencies and other similar digital assets that are based on distributed ledger technology may not be used, directly or indirectly, as a means of making payments.
“Payment service providers will not be able to develop business models in a way that crypto assets are used directly or indirectly in the provision of payment services and electronic money issuance, and will not be able to provide any services related to such business models,” reads the statement of the bank.
Turkey was experiencing a crypto boom in recent months, as many investors were turning to it in order to gain from the rally Bitcoin is enjoying while also using it to protect themselves against inflation. Since the Turkish lira continues to be weak and inflation is growing, the demand for crypto has skyrocketed.
In order to explain the ban, the bank commented that the assets were “neither subject to any regulation and supervision mechanisms nor a central regulatory authority.”
It has also added that “It is considered that their use in payments may cause non-recoverable losses for the parties to the transactions due to the above-listed factors and they include elements that may undermine the confidence in methods and instruments used currently in payments.”
A week ago, authorities in Turkey asked trading platforms to offer user information.
The annual inflation for the country has reached an increase of 16% in March.
Following the news of the ban, Bitcoin fell by 2.59% to $61.757.
Source: Reuters.com