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Turkey Plans to Introduce Strict Regulations to Secure Crypto Businesses

03 November, 2023

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Turkey is preparing new regulations for virtual asset service providers to regulate crypto trading platforms and prevent them from money laundering and terrorist financing. 

Turkey’s government is implementing strict laws on crypto assets to ensure they comply with the international watchdog, Financial Action Task Force (FATF), standards to delist them from the increased AML monitoring list. Turkey’s finance minister claimed they had overcome almost all 40 recommendations from the FATF, but the remaining issue is in the latest crypto transaction laws, and after complying with laws, they may exit from the gray list. Finance Minister of Turkey, Mehmet Simsek, stated, “the only remaining issue within the scope of technical compliance is the work related to crypto assets. We will submit a law proposal on crypto-assets to the parliament soon. After that, there will be no reason for Turkey to stay on that gray list if there are no other political considerations.”

The FATF added Turkey to the gray list in 2021 due to the inadequate money laundering and terrorist financing system. According to the FATF report on Turkey’s compliance process, the annual plenary meeting at Paris headquarters on Oct 30th determined that Turkey adhered to all of the 40 recommendations set by the watchdog except the technical compliance in crypto assets. Simsek stressed that the new regulations are solely about the crypto assets and their link to money laundering and terrorist financing but do not specify the legal changes in the existing laws. He also emphasized the essential need for a money laundering prevention system in the country’s financial system. It will improve the country’s reputation and international investors, raising its economy. 

However, the country’s law enforcement agencies still have shortcomings that damage the global financial ecosystem, including the loopholes in their crypto registering platforms. Turkey needs to meet international standards to prevent being used by bad actors for money laundering and terrorist financing. The compliance system will create a positive image in the global market and raise investors’ interest in the country’s economy. The international community also demands that the Turkish government plan a legal framework for crypto assets service providers and prevent terrorist financing and money laundering. Once Turkey fully complied with all the regulations, FATF had no reason to keep it on the “gray list.”

Suggested Reads: 

FATF Endorses Latest AML Regulations in the Final Plenary Meeting

UK Law Society Ensures Solicitors Complying With AML Measures

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