Turkey’s central bank has prohibited the usage of crypto assets as a means of payment, asserting that they pose significant perils due to their volatile nature, irretrievable transactions and that they are used in unlawful transactions.
The bank also noted that crypto assets “are not dependent on any supervisory and regulatory mechanisms and are not regulated by the central regulatory body.”
The event comes after months of economic turmoil in Turkey, climaxing in the appointment by President Recep Erdogan of the current president of the central bank, Chahap Kavcioglu.
It seems that Kavcioglu has no intention to engage with cryptocurrencies, as the official statement cites the following explanations for the ban:
- Cryptocurrencies are not subject to any supervisory and regulatory mechanisms by the central regulatory body;
- Has a market price that can be too volatile;
- Can be utilized for unlawful activities due to its anonymous form;
- Has wallets that can be hacked or operated without the authorization of their owners;
- Applies irretrievable transactions.
Turkey’s central bank decision to ban the use of digital assets to buy goods and services comes only a week after Turkish agencies demanded user data from various trading platforms.
Other countries have barred the use of cryptocurrencies in payments as well: in Russia, this ensued this year, China made the same decision back in 2017.
As one might suggest, Twitter is filled with angry messages, and notorious Bitcoin supporter and crypto investor Anthony Pompliano wrote that Bitcoin “won over the free market, and now governments and central banks are aiming to cheat.”
“It doesn’t matter, Pompliano determined. Crypto acceptance in these countries stays unabated.“
Cryptocurrencies turned into a safe-haven asset after the national currency of Turkey, the lira, has been continually crippled by growing inflation.
