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There aren’t any specific laws governing concluding cryptoasset deals in Turkey. However, the local government is keeping a close eye on cryptocurrency activities; therefore, registering a cryptocurrency business in Turkey requires an in-depth knowledge of all regulatory aspects of financial transactions in this country.

Regulators

Neither the CMB nor any other government agency are deemed competent enough to regulate cryptoasset activities in Turkey. There is, however, a task force made up of various government agencies (the BRSA, TCB & CMB) that are responsible for overseeing cryptocurrency traders’ activities.

Status

Except for online exchanges, cryptocurrencies are used by real-estate & IT companies; however, none of them are licensed with any Turkish regulators, such as the CMB or BRSA.

Investment & Financing

Pursuant to the BRSA’s definition, cryptocurrencies aren’t deemed e-money & shouldn't be governed by the PSS Act. Therefore, regulation of cryptocurrency activities in Turkey lies outside the organization’s mandate.

All those interested in registering a Turkish investment institution should keep in mind that entities like this aren’t permitted to undertake any transactions involving cryptocurrency-based derivatives. 

Turkey: ICO

As mentioned above, there’s no legal framework regulating cryptocurrencies in the Turkish Republic. Therefore, it’s yet unclear what legal status ICO has. Depending on its nature, launching an ICO in Turkey may be similar to launching a PCO or crowdfunding. In this case, it falls under the CMB’s regulation. 

Since ICOs aren’t currently regulated, there aren’t any limitations applicable to investors. If an offer qualifies for an issue of securities in the Turkish Republic, investors will have to abide by legal requirements applicable to regular financial instruments.

Turkey: Crowdfunding

Raising funds through equity capital is governed by an CMB circular which came into effect in late 2019.

AML & KYC

There aren’t any particular requirements applicable to the offer of cryptocurrencies in the Turkish Republic. Therefore, online trading platforms & cryptocurrency exchanges furnish their services to clients exclusively through banking institutions. It is, therefore, up to the said platforms whether they will abide by KYC/AML demands. That said, registering a cryptocurrency company in the Turkish Republic requires following KYC procedures & appointment of a compliance officer.

Banking Institutions

Currently, banking institutions, irrespective of whether they’re private or public, disallow their clients to open cryptocurrency accounts in the Turkish Republic. That said, it’s still possible to open corporate accounts for cryptocurrency companies in the Turkish Republic through online trading platforms. Accounts registered on these platforms aren’t connected to cryptocurrencies & enable platforms to carry out payments only via their own bank accounts. 

Conclusion

As mentioned before, Turkey has no legislation allowing or disallowing individuals to engage in transactions with cryptocurrencies. Nevertheless, the absence of cryptocurrency regulatory framework in Turkey doesn’t stop the local government & its agencies from introducing blockchain technology into their day-to-day operations.

Want to know more about cryptocurrency regulation in Turkey? Interested in registering a cryptoasset company in the Republic of Turkey? Why not reach out to IQ Decision UK? Our legal consultants are always on standby to give you a hand with any legal issues you’re facing.