| 18 May 2021, Tuesday | النسخة العربية

Turkey prohibits the use of Bitcoin and cryptocurrencies to purchase goods and services

The Turkish Central Bank has banned the use of currencies and crypto assets in purchasing goods and services, pointing to potential irreparable damages and great risks in those transactions.

In the legislation published in the Official Gazette, early Friday, the central bank said: “Cryptocurrencies and other digital assets based on distributed ledger technology cannot be used, directly or indirectly, as a payment tool.”

The bank added: “Payment service providers will not be able to develop business models in a way in which encrypted assets are used, directly or indirectly, in providing payment services and issuing electronic funds, and they will not be able to provide any services related to these business models.”

A growing boom in the crypto asset market in Turkey has gained more momentum recently, as investors hope to profit from a bitcoin rally and hedge against inflation.

The weakness of the Turkish lira and inflationary pressures also drove the demand for cryptocurrencies.

In a statement explaining the reason behind the ban, the bank said: “These assets are not subject to any regulatory or supervisory mechanisms nor to a central regulatory authority.”

Last week, Turkish authorities requested user-related information from trading platforms.

Annual inflation in Turkey rose to more than 16 percent in March.

The decision takes effect on April 30th, noting that the Bitcoin currency had fallen 2.59% to 61,757 dollars.