Turkey’s central bank banned the use of cryptocurrencies and cryptocurrencies to purchase goods services, citing “irreparable” potential losses and significant risks in such transactions.
In legislation published in the Official Gazette overnight, the Central Bank of Turkey (CBRT) stated that cryptocurrencies and other such digital assets based on distributed digital technology could not be used, directly or indirectly, as a means of payment.
“Payment service providers will not be able to develop a model of how crypto assets are used, directly or indirectly, in the provision of payment services and electronic money issuance, and to provide any services related to such business models Will not be able to, ”the bank said.
A rapid boom in Turkey’s crypto market gained further momentum recently, with investors expecting both a bitcoin rally and a shelter from inflation.
A weak Turkish lira and inflationary pressure also boosted cryptocurrency demand.
In a statement explaining the reason behind the demonetisation, the bank said that these assets are “subject to neither a regulation and supervision mechanism nor a central regulatory authority”, among other security risks.
The central bank stated, “It is assumed that their use in payment may be due to the loss of the transaction from the parties to the transactions caused by the factors listed above and include such elements.” Which may undermine confidence in the methods and instruments currently used in payments, ”the central bank said in testimony.
Last week, Turkish officials demanded user information from the trading platform.
Turkey’s annual inflation exceeded 16% in March.
This law will come into force on 30 April. Bitcoin fell 2.59% to $ 61,757 at 0557 GMT.
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