On May 16, the ruling party in Turkey submitted a crypto bill to the parliament. This draft bill focuses on the licensing and registration of crypto service providers and aims to align with international standards.
According to a report from Reuters, the purpose of the draft bill is to update existing laws in order to comprehensively regulate the cryptocurrency market. The bill’s main areas of focus include consumer protection, platform transparency, and compliance with financial regulations.
The proposed legislation aims to regulate cryptocurrency trading platforms and other service providers in the sector, requiring them to obtain licenses from Turkey’s Capital Markets Board (CMB).
The draft law seeks to govern various aspects of the crypto industry, including crypto asset service providers, crypto asset platform operations, crypto asset storage, and crypto asset buying, selling, and transfer transactions conducted by Turkish residents. The legislation also addresses the classification of cryptocurrencies and projects, ensuring compliance with existing financial regulations. Some key points from the bill include:
– Crypto service providers must be licensed and regulated by the Capital Markets Board.
– The CMB will have enhanced oversight in order to protect consumer assets and ensure effective dispute resolution.
– Crypto service providers will be required to pay mandatory revenue to the CMB and the Scientific and Technological Research Council of Turkey.
– Foreign crypto brokers will be banned in order to foster a locally regulated ecosystem.
This move aims to bring Turkey in line with international standards and address concerns raised by the Financial Action Task Force (FATF), thereby enhancing the security and reliability of the national crypto market.
The draft law also proposes the inclusion of the FATF-issued travel guidelines. The FATF Travel Rule requires cryptocurrency companies and financial institutions involved in digital asset sales (collectively known as virtual asset service providers) to obtain and share “accurate originator information and beneficiary information” with counterparty VASPs or other financial institutions before or during transactions.
In October 2021, Turkey was demoted to the “gray list” by the FATF due to its failure to implement Anti-Money Laundering measures in various industries, including banking and real estate. Countries on the gray list are required to actively cooperate in rectifying any shortcomings and are subjected to heightened scrutiny.
Overall, the submission of this crypto bill reflects Turkey’s efforts to regulate and strengthen its crypto industry while aligning with international standards.