Turkey’s central bank banned the use of cryptocurrencies and crypto assets to purchase goods and services, citing “irrepairable” possible damages and significant risks in such transactions, Reuters reported.
In legislation published in the Official Gazette overnight, the Central Bank of Turkey (CBRT) saidthe Central Bank of Turkey (CBRT) said cryptocurrencies and other such digital assets based on distributed ledger technology could not be used, directly or indirectly, as an instrument of payment. cryptocurrencies and other such digital assets based on distributed ledger technology could not be used, directly or indirectly, as an instrument of payment.
“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,” the bank said.
A growing boom in Turkey’s crypto market had gained further pace recently, with investors hoping to both gain from bitcoin’s rally and shelter against inflation.
“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,” the central bank said in a statement.
CBRT states the risks as follows
- they are neither subject to any regulation and supervision mechanisms nor a central regulatory authority,
- their market values can be excessively volatile,
- they may be used in illegal actions due to their anonymous structures,
- wallets can be stolen or used unlawfully without the authorization of their holders, and
- transactions are irrevocable.