The Central Bank of the Republic of Turkey has instituted a ban on cryptocurrency payments, as its own fiat currency is devalued.
Turkey has instituted a ban on all cryptocurrency payments as its own fiat currency, the lira, is failing. The ban is said to commence at the end of April.
“Payment service providers cannot develop business models in a way that crypto assets are used directly or indirectly in the provision of payment services and electronic money issuance, and cannot provide any services related to such business models,” per the new regulations from the Central Bank of the Republic of Turkey (CBRT), as reported by MarketWatch,
The CBRT gave several reasons for the ban, which included a lack of mechanisms for “supervision” and “central authority regulations” for cryptocurrencies. The CBRT also cited the cryptocurrency market’s volatility as well as the fact that many cryptocurrency transactions are irrevocable.
“It is considered the use in payments may cause non-recoverable losses for the parties to the transactions due to the above-listed factors and they include elements that may undermine the confidence in methods and instruments used currently in payments,” the CBRT regulation said, per MarketWatch.
Following months of economic downturns, Turkish locals have taken to exchanging their lira for bitcoin and other foreign currencies. According to LocalBitcoin’s volume of peer-to-peer bitcoin trades involving the lira, 2021 has seen significant BTC activity.
Also, in March of this year, the Nigerian central bank issued a reminder of a ban on financial services for cryptocurrency exchange operators in the country. The reasons given were also similar to those given by the CBRT in this recent update.
While bans like these can generate a lot of FUD, which can be reflected in bitcoin’s price, Bitcoin still goes on to be traded peer to peer and under the radar, as it did in its early days. With Bitcoin always surviving situations like these, many Bitcoiners believe that Bitcoin can’t be banned outright.