Turkey Tightens Crypto Oversight: New Rules Effective February 2025
Turkey is taking a significant step in cryptocurrency regulation, with new rules set to roll out on February 25, 2025. These regulations empower crypto service providers to halt transactions deemed “risky” if user information is inadequate, aiming to curb illicit financial activities.
A Push for Greater Oversight
Announced on December 25, 2024, Turkey's new framework mirrors progressive regulatory measures seen globally, particularly Europe’s Markets in Crypto-Assets (MiCA) bill, which takes effect on December 30. Under the Turkish regulations, users transferring over 15,000 Turkish lira (approximately $425) must provide identifying information. However, smaller transactions fall outside this requirement, simplifying processes for everyday users.
Focus on Anti-Money Laundering
This updated Anti-Money Laundering (AML) framework is designed to combat money laundering and terrorism financing through crypto platforms. Notably, it mandates that crypto providers gather additional data from users interacting with wallet addresses not previously registered within their systems. Transfers failing to meet these standards may be flagged and even halted, with providers instructed to sever ties with non-compliant financial institutions.
Turkey’s Growing Crypto Presence
Ranked as the world’s fourth-largest crypto market as of September 2023, Turkey recorded an impressive trading volume of $170 billion, outpacing countries like Russia and Canada. This surge underscores the growing role of crypto in the nation’s economy, even as regulatory measures aim to balance innovation with risk management.
A Year of Transformation for Crypto in Turkey
In 2024, Turkey's crypto sector experienced heightened activity. By August, the Turkish Capital Markets Board (CMB) had received 47 license applications under a new regulatory framework introduced in July. The "Law on Amendments to the Capital Markets Law," effective from July 2, laid the foundation for this regulatory push.
While individuals in Turkey can legally trade, hold, and buy cryptocurrencies, their use for payments remains banned since 2021. Additionally, discussions are underway to introduce a minimal 0.03% transaction tax on crypto trades, aiming to support the national budget without stifling market growth.
Preparing for February 2025
As Turkey moves to enforce these regulations, crypto service providers face the dual challenge of enhancing compliance mechanisms and maintaining user trust. The implementation signals a new era in Turkey’s crypto landscape, balancing innovation with robust safeguards to protect its growing digital economy.