Well, the Turkish Finance Minister has decided to gift us all with a new masterpiece—a draft law for the regulation of cryptocurrencies. Hold on to your compliance hats, folks, because it’s time for some “legal certainty” and, of course, the joyous burden of “strict requirements.”
Apparently, Turkey has had an epiphany and is now getting serious about regulating cryptocurrencies. This newfound enthusiasm stems from the fact that the Financial Action Task Force (FATF) placed them on the gray list in 2021, essentially giving them a pat on the back for not being vigilant enough in the fight against money laundering. How heartwarming.
Mehmet Simsek, Turkey’s Finance Minister, gleefully informed us that they are almost perfect in the eyes of the FATF. They’ve nailed 39 out of 40 FATF standards, except for that minor issue of “technical compliance regarding crypto assets.” Oh, but don’t you worry, dear citizens, they’ve got a solution ready! Simsek declared that they will swiftly introduce a draft law on crypto assets to parliament, and just like that, Turkey will be free from the gray list’s clutches. As for the specifics of this brilliant plan, well, those are apparently classified information.
If you’re eager for details, you might want to flip through Turkey’s delightful 500-page annual presidential program for 2024. There’s a tantalizing mention of “planned studies to define crypto assets” and the promise of taxing them properly. Exchanges and crypto service providers will also get their moment in the spotlight by being “legally defined.” But, surprise, surprise, the document conveniently skips the nitty-gritty of the forthcoming regulations. Who needs clarity, right?
Oh, the FATF, that stickler for rules and procedures. Of course, they’re likely to require Turkey to follow the usual routine, including the famous “Travel Rule.” A rule known for its technical complexity, which is sure to be a walk in the park for our dear friends in Turkey.
In a shocking turn of events, it seems that Turkey has a soft spot for cryptocurrencies. Perhaps it’s the sky-high inflation of the Turkish lira that’s fueling this infatuation. Surveys even claim that every other Turkish citizen has jumped on the crypto bandwagon.
But alas, from a regulatory perspective, the crypto industry in Turkey finds itself in a perplexing state of limbo. It’s neither fully embraced nor outlawed. This delightful lack of rules leaves the crypto community dancing to the government’s whims. Remember when they spontaneously banned crypto as a means of payment in mid-2021? Good times.
Companies are caught in this regulatory tug-of-war, not sure how to behave. On one hand, they’re free from the regulatory shackles that torment their European counterparts, but on the other, they’re constantly tiptoeing towards a potential prison sentence. Just ask Faruk Fatih Özer, the Thodex exchange founder who managed to snag a comically lengthy prison term of nearly 12,000 years after his Albanian escapades.
Given President Erdogan’s previous proclamation of “war” on Bitcoin, it’s safe to say that the upcoming regulations won’t be a picnic. So, brace yourselves, Turkey, for the government is here to bring order to the chaos that is the cryptocurrency world. We can’t wait to see how this unfolds!