Many cryptocurrency fans were dismayed to discover on Friday (April 16) that Turkey’s central bank has banned the use of cryptoassets for payments. However, the author of The Bitcoin Standard says that this might be a blessing in disguise.
According to a press release by the Central Bank of the Republic of Turkey that came out earlier today, “studies on the regulation regarding the disuse of crypto assets in payments have been completed,” and the central bank has come to the conclusion that “crypto assets entail significant risks to the relevant parties,” such as “their market values can be excessively volatile” and “they may be used in illegal actions due to their anonymous structures.”
Turkey’s central bank went on to say:
“Accordingly, pursuant to the authority vested by the Law No:1211 on the Central Bank of the
Republic of Turkey (CBRT) and the Law No. 6493 on Payment and Securities Settlement Systems,
Payment Services and Electronic Money Institutions, the CBRT has introduced ‘Regulation on the
Disuse of Crypto Assets in Payments’.“
A report by the official newspaper of the Turkish government that got published today provides the following details on theis regulation:
- “Crypto assets cannot be used directly or indirectly for payments.“
- “No service can be provided for direct or indirect use of crypto assets in payments.“
- “Payment service providers cannot 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 cannot provide any services related to such business models.“
- “Payment and electronic money institutions cannot mediate on platforms offering trading, custody, transfer or issuance services regarding crypto assets or fund transfers from these platforms.“
It goes on to say that this regulation become effective on 30 April 2021.
Shortly after this news came out, Dr. Saifedean Ammous, the author of The Bitcoin Standard, said on Twitter that this might be “good for bitcoin and for Turks” since Turkey’s central bank, via these new regulations, is in a way “encouraging” people living in Turkey to hold on to their crypto since they won’t be able to use it for paying for goods and services.
As a report by Cointelegraph correctly points out, “while banks are excluded from the regulation, which means users can still deposit Turkish lira on crypto exchanges using wire transfers from their bank accounts, payment providers will be unable to provide deposit or withdrawal services for crypto exchanges.”
The views and opinions expressed by the author, or any people mentioned in this article, are for informational purposes only, and they do not constitute financial, investment, or other advice. Investing in or trading cryptoassets comes with a high risk of financial loss.