Turkey’s Bold Leap into Crypto Regulation: Safeguarding the Future of Digital Finance

Introduction and Key Changes
Turkey has recently introduced new rules for cryptocurrencies to improve oversight and ensure compliance within its growing market. These regulations, published on December 25, 2024, will start on February 25, 2025. One of the major changes is that if a cryptocurrency transaction exceeds 15,000 Turkish liras (about $425), users will need to provide identifying information to service providers. This aims to help prevent money laundering and the financing of terrorism. In addition, crypto service providers must confirm the identity of users when transactions involve unregistered wallet addresses. If a transfer lacks sufficient sender details, it may be considered "risky," possibly resulting in suspended transactions or the end of business relationships.

Licensing and Compliance Requirements
Crypto platforms will now need to get approval from the Turkish Capital Markets Board (CMB) to operate legally. Any existing providers must apply for a license within one month of the law taking effect. If they do not comply, they could be forced to shut down within three months, with potential jail time of three to five years and large fines for unauthorized operations. These new regulations also align with international standards, including guidelines set by the Financial Action Task Force (FATF). Turkey has made improvements in its anti-money laundering efforts and was recently removed from the FATF "grey list." Additionally, all crypto ATMs that allow cash-to-crypto conversions must be shut down within three months of the new law's effect.

Impact on the Crypto Market
Turkey's crypto market is one of the largest in the world, with a trading volume estimated at $170 billion as of September 2023. The new regulations aim to protect investors better against fraud and manipulation while creating a more organized framework for cryptocurrency operations. Overall, these changes show Turkey's dedication to making the crypto landscape safer and more transparent, addressing both local and international concerns.