Turkey is expected to tighten controls on cryptocurrency transactions in a move to prevent the misuse of digital assets. The latest rules, set to take effect from February 25, 2025, will allow cryptocurrency service providers to put a halt on transactions deemed “risky” due to insufficient customer information.
This development arose from improved crypto regulations in other global jurisdictions, with Turkey taking a page from Europe’s book. As part of this stricter regime, customers carrying out transactions exceeding 15,000 Turkish lira (or $425) will need to have their identification details on file with service providers. The aim of these Anti-Money Laundering (AML) laws is to obstruct the ill-intentioned use of cryptocurrencies for money laundering and funding terrorist activities.
Crypto providers, however, won’t need to collect data for transfers less than $425. These new rules arrive amidst a growing focus on crypto regulations worldwide, predating the coming into effect of Europe’s Markets in Crypto-Assets (MiCA) bill – the world’s foremost all-inclusive crypto regulatory framework – by just a week.
Following the adaptation of these regulations, crypto providers will also need to have identifying details for customers using wallet addresses not previously registered with them. If providers are unable to get the required details from a sender, the transfer may be deemed as “risky,” giving the provider the discretion to halt the transaction.
With a staggering trading volume of $170 billion as of September 2023, Turkey ranks as the fourth-largest crypto market worldwide, even outranking heavyweights like Russia and Canada. The country’s increased regulatory focus in 2024 saw the Turkish Capital Markets Board receiving 47 license applications from crypto companies, following the introduction of a law providing regulatory standards for crypto service providers. While it is legal to purchase, hold and trade crypto in Turkey, use for payments has been prohibited since 2021. Although crypto profits are not taxed, there is contemplation on instituting a minor 0.03% transaction tax to supplement the national budget.