As the government works to create a more regulated legal environment for crypto assets, Turkey is seeing an increase in applications for cryptocurrency licenses.
This trend, fueled by a group of Legal clarity and economic considerations, It shows how keen cryptocurrency companies are to operate in the country.
The continued decline in the value of the Turkish lira and high inflation rates have prompted many people to look for other investment possibilities, which has increased the demand for cryptocurrencies.
Cryptocurrencies: Evolution in Regulations
Currently in the final study phase, the Turkish government is calling on Virtual Asset Service Providers (VASPs) to obtain permits from Capital Markets AuthorityThis program aims to improve investor security and provide a safe space for cryptocurrency trading.
The Central Bank of Turkey is monitoring things to make sure they are following the rules. This is very important to gain investor confidence and push Turkey towards global standards.
turkey It ranks well in global adoption rates and has become one of the fastest growing Bitcoin markets in recent years. Reports suggest that over the past year, the country has seen an eleven-fold increase in cryptocurrency usage, with many people turning to digital assets as a hedge against economic uncertainty.
Turkey may not have full-fledged crypto laws at the moment, but there are rules to govern the industry. In January, Turkish Finance and Treasury Minister Mehmet Simsek hinted that the country’s crypto bill was almost complete. But the long-awaited bill is still missing from parliament.
Economic aspects encouraging adoption
Interest in cryptocurrencies has been sparked by the country’s economic situation. Many people are looking for new ways to protect their investments since inflation exceeded 60% in August 2023 and the value of money is at an all-time low. The fall of the lira has made cryptocurrencies a desirable means of diversification and savings.
According to Chainalysis, Turkey’s cryptocurrency market is the fourth largest in the world with a trading volume of over $170 billion. This puts Turkey’s Bitcoin market ahead of Germany, Russia, Canada, Vietnam, and Thailand.
Local cryptocurrency exchange Paribu has seen an increase in trading volumes, especially in stablecoins like USDT. Investors in Turkey are increasingly adopting stablecoins as a means of mitigating currency risk.
This change underscores a more general trend of individuals increasingly using digital assets to protect their money during difficult times, in addition to investment purposes.
The way forward
Turkey is currently working on developing rules for cryptocurrencies, which shows that this industry has a lot of potential for the future. To encourage innovation and attract foreign capital, the government wants to clarify the system.
Meanwhile, the construction of the Istanbul Finance Center to encourage the spread of financial technology would create an ideal environment for the advancement of projects related to blockchain and Bitcoin.
Featured image from Bloomberg, chart from TradingView