Turkey to meet FATF requirements and adopt new crypto regulations
Turkey to meet FATF requirements and adopt new crypto regulations
In Turkey, new rules for regulating the crypto market will change the principles of licensing and taxation. The changes come amid a push by Turkish authorities to remove the country from the "gray list" zone.
Ankara announced its intention to introduce the new rules last month, the need for which has increased with the growth of cryptocurrency trading. Turkey has become the world's fourth-largest cryptocurrency trading nation amid rising inflation and a falling lira, Reuters reported.
The Financial Action Task Force (FATF) has classified Turkey as a gray-listed country, which includes countries that have seen widespread money laundering through the crypto market as well as other numerous financial crimes.
Bora Erdamar, Director of the BlockchainIST Center, said, "Implementing licensing standards will be a top priority in the new regulation and will prevent abuse of the system."
The new regulations will likely include capital requirements, digital security measures, and confirmation of reserves.
Analysts have noted that Turkey is the third-largest country in terms of raw cryptocurrency transactions after the U.S., India, and the UK. It totaled $170 billion for the current year.
Last month, Turkish Finance Minister Mehmet Şimşek announced that Ankara would implement the last remaining FATF recommendation and introduce new legislation to regulate crypto-assets as soon as possible in order to remove Turkey from the gray list. The minister warned that failure to do so could affect the country's investment ratings.
Gray zone countries are not working to strengthen the fight against money laundering and other financial crimes, so the FATF is urging them to proactively address legislative shortcomings.
The FATF previously said in a July report that Turkey was failing to properly regulate and identify digital and virtual service providers by not requiring them to be licensed and registered.
The Turkish government has said that work on regulating cryptoasset service providers and taxing digital virtual assets will be on the 2024 agenda.
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