Cryptocurrency in Turkey: A guide

By Justin Mays:

Turkey’s cryptocurrency market is among the top five in the world with nearly 5 million cryptocurrency platform accounts. In April 2021 the government banned their use to pay for goods and services which was in response to claims that these transactions were too risky, nonetheless trading crypto is still permitted and it is legal to hold crypto assets.

The intentions of the government

For now, cryptocurrencies exist in a legal grey area in Turkey however Ankara will take new legal steps in response to their use. This is good news for crypto enthusiasts. According to Bloomberg, the government is looking to establish a central custodian bank to eliminate counterparty risk. Lawmakers plan on streamlining registration for new exchanges and potentially allowing for direct cash to crypto exchange in Turkish lira.

Mustafa Elitaş, ruling party AKP’s deputy head, told the parliament on January 6 “The aim is to regulate the system, to prevent malicious intent, protect investors and prevent victimization.”

Like the rest of the world, interest in crypto among Turks has increased over the years. It is particularly popular as a substitution for saving in gold and dollars to shield investors from inflation. BTCTurkPro, one of the largest domestic crypto exchanges, reports an average of $300 million a day in transactions. Another domestic exchange, Paribus, grew its user base from 1.5 million to 5 million in 2021. Paribus allows Turks to use their bank accounts to buy and sell in Turkish lira and their daily trading volume increased from $20m a day in 2020 to more than $500m by the end of 2021. International exchanges like Coinbase and Binance also operate in Turkey.

The importance of the crypto world in Turkey

It is impossible to miss how much influence crypto has in Turkey. Brick-and-mortar exchanges have popped up in busy areas like Kadikoy and Taksim. Daily local crypto transactions exceeded one million in March last year. Ads and commercials targeting investors are peppered throughout the city and are broadcast on TV. On many channels, the current Turkish lira to fiat currency news tickers also lists the latest Bitcoin value. Foreigners with crypto investments can be assured that it is easy to use their assets in Turkey.