Turkey's Financial Watchdog Plans to Regulate Crypto Markets, Report Says

Capital Markets Board of Turkey has plans to regulate crypto transactions, according to local sources.

Capital Markets Board of Turkey (CMB), the regulatory body overseeing securities markets in the country, is developing a guideline to observe, audit, and regulate the crypto markets in the country, major Turkish media outlet Hurriyet reported on Jan. 4.

Public authorities in Turkey have concerns regarding the protection of investors in crypto markets. The government entrusted CMB with the development of a regulatory framework for crypto markets, according to the report. Per the request by the government, CMB plans to ramp up its efforts to audit and regulate crypto markets in Turkey in 2020.

A legal structure to accelerate growth

Stressing Turkey's potential in both crypto and blockchain, financial expert and Cointelegraph Turkey contributor Erkan Oz explained that Capital Markets Board's (CMB) legal structure would accelerate the growth of the local crypto ecosystem. "I guess CMB would also protect investor rights, which will bring many more investors to crypto projects," he said.

Huobi Turkey General Manager Alphan Gogus stressed the fact that Turkish regulators’ positive approach will speed up the adoption of crypto in the market, “which will lead to a growth in the active user base and trading volume, thus the value of the Turkish crypto market will increase.” Gogus added that a regulatory framework would eliminate any possible negative effects of bad practices across the industry and foster cooperation with financial institutions.”

Protection for local and global investors

Speaking to Cointelegraph, Chief Editor of Blockchain Turkey Platform Ahmet Usta noted that crypto markets, just like any other markets, need to be regulated to protect the rights and safety of investors:

"On the other hand, excessive regulation or heavy taxes would harm the markets and hamper innovation efforts. That's why we need a balance between protection and encouragement when it comes to regulations. Turkey has a dynamic crypto market that attracts global investors, and this structure should be preserved while avoiding any unfair competition with other investment tools."

Cagla Gul Senkardes, CEO of MenaPay, also remarked regarding the rise of the crypto ecosystem in Turkey:

"The crypto industry needs sustainable growth, so any news regarding crypto regulation is welcomed. Having a regulatory framework for crypto that ensures the security and sustainability of local and global contributions would pave the way for new investments, employment, and innovation."

No regulation for crypto

Turkey is already a top adopter and a renowned market when it comes to blockchain and cryptocurrencies. Major global crypto exchanges like Binance and Huobi have made moves to establish a local presence in the country. The government has a vision for a national blockchain infrastructure and a central bank-issued digital currency.

Despite the massive interest of its people, Turkey does not have dedicated rules for crypto markets. Binance CEO CZ told Cointelegraph in an interview that they are working with local regulators when entering Turkey. 

Huobi Group Regional President Mohit Davar also expressed the importance of going into the Turkish market in a compliant way. "We talk to the stakeholders to make sure we are working closely with them in a controlled fashion," he said.