The Turkish ruling party, the AK Party, has reportedly submitted a draft bill to parliament in a bid to update the laws governing the country’s cryptocurrency market.
According to Reuters, the bill aligns with international standards and emphasizes licensing and registration for crypto service providers. It also focuses on enhancing consumer protection, increasing platform transparency, and ensuring compliance with financial regulations.
The proposed regulations would require cryptocurrency trading platforms and service providers to obtain licenses from Turkey’s Capital Markets Board (CMB). This measure is reportedly designed to strengthen oversight and protect consumer assets. Additionally, the CMB will play a crucial role in the sector; it will be able to to create secondary regulations and establish procedures for service providers and transactions.
The legislation would also require crypto service providers to remit revenue to both the CMB and the Scientific and Technological Research Council of Turkey to support the regulatory infrastructure and promote innovation within the local cryptocurrency ecosystem.
The bill proposes a ban on foreign crypto brokers, a move aimed at addressing international concerns.
The proposed regulations are expected to help Turkey rectify its standing with the Financial Action Task Force (FATF). In October 2021, the country was placed on the FATF’s “gray list” for failing to implement adequate Anti-Money Laundering measures across its banking, real estate, and other sectors. Being on this list subjects Turkey to increased scrutiny and requires active cooperation in addressing these deficiencies.
The FATF is expected to publish a report in June 2024 on the compliance levels of European countries with its recommendations. Notably, local authorities expect the FATF to upgrade Turkey from the “grey list.” Reuters reported that a team from the FATF met with Turkish authorities earlier this month.
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The draft law includes FATF-issued travel guidelines, which mandate that cryptocurrency companies and financial institutions involved in digital asset transactions must obtain and share “accurate originator information and beneficiary information” with counterparty VASPs or other financial institutions before or during transactions.
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