Turkish Authorities to Apply AML and Terrorism Financing Regulations to Cryptocurrency Transactions

Turkey has reportedly decided to add digital currency trading platforms to its list of companies that will come under the nation’s anti-money laundering (AML) and terrorism financing regulations. This, according to a presidential decree that was released on Saturday (May 1, 2021).

The Official Gazette stated that Turkey’s updated rules for covering crypto-related transfers should be effective immediately and will also apply to “crypto-asset service providers.” These entities will now have to adhere to applicable regulations, Reuters reported.

In April 2021, the reserve bank of Turkey had banned the use of cryptocurrencies for making payments. Turkish officials had said that using cryptos for transactions posed risks for consumers. Last month, two Turkey-headquartered virtual currency exchanges had also suspended their activities and were being investigated for mismanagement and alleged fraud.

The investigation into one of the exchanges, Thodex, resulted in the arrests and jailing on Thursday (April 29, 2021)  of six individuals suspected of engaging in unlawful activities. Turkish authorities reportedly arrested the siblings of Thodex’s CEO, Faruk Fatih Ozer, who officials are trying to find after he left for Albania.

In total, there were six individuals that were arrested including Ozer’s brother and sister, and senior management employees at Thodex, according to the spokesperson for Istanbul’s Anadolu prosecutor’s office.

As covered recently, Turkish regulators are working on updating crypto regulations, as another major exchange was facing major issues.

As reported, Turkish crypto exchange Vebitcoin had suspended its operations and claims that it decided to do so due to deteriorating financial conditions. This according to a report from the Demiroren News Agency which had noted that Vebitcoin’s CEO Ilker Bas and several other workers are being detained by Turkish authorities. The country’s Financial Crimes Investigation Board has reportedly blocked Vebitcoin’s accounts and launched an investigation into the matter.

The nation’s central bank head Sahap Kavcioglu revealed that they’re working on updated regulations for cryptos. He confirmed that they’re currently working “on regulations in terms of cryptocurrency” and that there are “disturbing money outflows to outside of Turkey via cryptocurrencies.”

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