Citing possible irredeemable damage and distinctive transaction risks in a move that cooled world bitcoin prices, Turkey’s central bank banned the use of cryptocurrencies and crypto assets to purchase goods and services
Crptocurrencies and other myriads of digital assets that are premised on distributed ledger technology, will not either directly or indirectly be used as an instrument of payment. The aforementioned information was contained in the legislation published in the official Gazette on Friday, by the Turkish Central bank.
As investors join a world rally in bitcoin seeking against lira depreciation and inflation, which increased to 16% last month, Turkey’s growing crypto market has gained momentum in recent months.
After the ban of cryptcurrencies by the Turkish Central Bank, Bitcoin was off nearly 3% at $69, 490 against the dollar at 0754 GMt and which the current position of the Turkish Government has been sternly criticized by the opposition party in Turkey.
.Among other security risks that are associated with cryptocurrencies, the central bank revealed that there is no regulation, supervision mechanism or central regulatory authorities on crypto in Turkey.
Also, the Trukish central bank continued that Business models cannot be provided by payment service providers that will enhance the use of crypto assets either directly or indirectly in the provision of electronic money issuance and payment services.
“Their use in payments may cause non-recoverable losses for the parties to the transactions … and include elements that may undermine the confidence in methods and instruments used currently in payments,” the central bank added.