The draft law intends to regulate the purchasing, selling, and transfer of cryptocurrency assets as well as the operations of cryptocurrency asset platforms, service providers, and storage.
On May 16, the ruling party in Turkey presented a draft cryptocurrency bill to the legislature. The law is in line with international norms and focuses on licensing and registration for crypto service providers.
A Reuters report states that the draft bill intends to modernize current legislation in order to fully regulate the cryptocurrency business. Three main areas of emphasis for the law are financial regulation compliance, platform openness, and consumer protection.
The proposed law would require cryptocurrency trading platforms and other industry service providers to apply for licenses from Turkey’s Capital Markets Board (CMB), in an effort to regulate the industry.
The proposed law intends to regulate cryptocurrency asset service providers, cryptocurrency asset platforms, cryptocurrency asset storage, and transactions involving the purchase, sale, and transfer of cryptocurrency assets by Turkish citizens. The law ensures adherence to current financial standards by addressing the classification of cryptocurrencies and projects. Several salient points to be noted from the bill are:
The Capital Markets Board is required to license and regulate cryptocurrency service providers.
Increased CMB monitoring to safeguard customer assets and guarantee efficient dispute settlement.
Required income collection by CMB and the Scientific and Technological Research Council of Turkey from cryptocurrency service providers.
Prohibition of international cryptocurrency brokers to promote a regionally governed market.
By addressing Financial Action Task Force (FATF) issues and bringing Turkey into compliance with international norms, this action aims to improve the security and dependability of the domestic cryptocurrency market.
The FATF’s travel rules are intended to be included in the draft statute. Virtual asset service providers (VASPs), which are financial institutions and cryptocurrency companies that engage in digital asset sales, are required by the FATF Travel Rule to obtain and share “accurate originator information and beneficiary information” with counterparty VASPs or other financial institutions prior to or during transactions.
The FATF placed Turkey on the “gray list” in October 2021 as a result of its inability to enforce anti-money laundering laws in its banking, real estate, and other sectors of the economy. Countries on the gray list are subject to increased scrutiny and are required by the FATF to actively participate in correcting any flaws.