Bitcoin’s ‘Excessive Volatility’ Underscores Turkey’s Central Bank Ban on Crypto Payments
As traders and investors ride Bitcoin’s latest whiplash, enduring a 15% drop within 48 hours, the central bank of Turkey is planning to ban all Bitcoin and crypto payments, effective April 30th, due to “excessive volatility”, among other caveats.
The Central Bank of the Republic of Turkey (CBRT) introduced “Regulation on the Disuse of Crypto Assets in Payments” on Friday, which outlaws the direct or indirect use of cryptocurrencies to pay for goods and services, citing risks involved in using digital assets.
In a press release, the monetary authority outlines the downside of crypto payments as well as their possible use in illegal activities, due to their anonymous nature. It also says the crypto market is excessively volatile and that wallets may be stolen or used without the holder’s permission.
“Crypto assets entail significant risks to the relevant parties due to the following reasons:
- they are neither subject to any regulation and supervision mechanisms nor a central regulatory authority,
- their market values can be excessively volatile,
- they may be used in illegal actions due to their anonymous structures,
- wallets can be stolen or used unlawfully without the authorization of their holders, and
- transactions are irrevocable.
Recently, some initiatives have emerged regarding the use of these assets in payments. It is considered that their use in payments may cause non-recoverable losses for the parties to the transactions due to the above-listed factors and they include elements that may undermine the confidence in methods and instruments used currently in payments.”
The CBRT’s move against cryptocurrencies comes as the Turkish lira continues to tumble in valuation.
The TRY/USD pair (lira/dollar) is down over 8% year-to-date from $0.134 in January to $0.123 at time of writing.
Bitcoin is currently trading at $55,540, up 89% year-to-date.
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Author: Daily Hodl Staff