Central Bank of Turkey Bans Settlements in Cryptocurrencies

The central bank of Turkey will ban the use of cryptocurrencies to pay for goods and services as from April 30, 2021.

April 16, 2021 | AtoZ Markets – The Turkish central bank announced a ban on payments in cryptocurrencies for goods and services. The decision will take effect on April 30.

Payment service providers are not allowed to develop business models in which crypto assets are directly or indirectly used in payments or issuing electronic money,” the central bank’s decision, published in the official TC Resmî Gazete, says.

Reasons Why Turkey Will Ban Cryptocurrencies

Among the reasons for the decision, according to local journalist Ragip Soil, the agency cited lack of regulation and central government, volatility, illegal use and the risk of theft.

The ban, however, does not yet apply to trading on cryptocurrency exchanges.

Bitcoin has long gained popularity in Turkey amid a protracted devaluation of the lira. In March of this year, the price of the first cryptocurrency on the local p2p market exceeded $100,000 when President Recep Erdogan fired the third head of the central bank in the past two years.

This is how the devaluation of the Turkish lira looks like (2018-2021). USD/TRY weekly chart from TradingView.

Turkey plans to launch CBDC

Meanwhile, the central bank of Turkey, together with the Financial Department of the President, are already working on the development of documentation for the creation and launch of the CBDC.

Previously, experts suggested that the introduction of their own CBDCs would simply kill the cryptocurrency market, since most likely they will be banned. In this way, governments will regulate competition with strong cryptocurrencies such as Bitcoin.

Think we missed something? Let us know in the comment section below.

Share Your Opinion, Write a Comment