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Turkiye

CMS Expert Guide to Crypto Regulation in Turkiye

Table of contents
  1.  How is crypto regulated?
  2. How quick and easy is to get a MiCA licence in Turkiye? 
  3.  Are the following activities regulated or unregulated in your jurisdiction? ― Direct sales of tokens by issuers — Exchange (buy/sell) ― Custody (hold) ― Borrowing/lending ― Yield/staking services ― Staking on proof of stake consensus mechanisms (please indicate if NFTs are treated differently from fungible cryptoassets for each activity)
  4. Can offshore business provide services to local customers on either active solicitation or reverse solicitation basis? 
  5. How long would establishing a cryptoasset business/obtaining a license in your jurisdiction take?
  6. What would be the approximate overall cost of obtaining a licence?
  7. What is the probability (%) of success in obtaining a licence?
  8. What other limitations are there in your jurisdiction when looking to set up a cryptoasset business? E.g., Compliance requirements and physical presence
Turkiye

Disclaimer: This chapter was last updated on 13th November 2024 and does not reflect any subsequent developments. The information provided is intended for general informational purposes and should not be construed as legal advice.

1. How is crypto regulated?

AML RegulationAny other regulation

 

As of 2021, crypto-asset service providers are required to comply with certain requirements under the Law on Prevention of Laundering Proceeds of Crime (AML Law). A guideline, published by the Financial Crimes Investigation Board following the inclusion of crypto-asset service providers as obligors under the AML regulations, defines these providers as service providers that intermediate the trading of crypto-assets through electronic trading platforms and provides detailed information regarding the AML obligations of crypto-asset service providers. 
 

Amendments regulating crypto were incorporated into the Capital Markets Law and entered into force on 2 July 2024 ("the Law").

 

The Law sets out detailed rules for the operation of crypto-asset service providers, permitted crypto-asset transactions, and the transitional period for the status of existing platforms, as it introduces a licensing requirement along with new liabilities.

 

The Law further provides that issues not addressed will be regulated by secondary legislation within six months of the Law's entry into force. Some of these outstanding issues have already been addressed by resolutions of the Capital Markets Board (CMB) in accordance with the Law’s mandate. It is expected that additional resolutions will follow, covering areas that remain unregulated in greater detail.

 

Licensing Requirement

 

Crypto-asset service providers in operation as of the Law's entry into force were required to notify the CMB within one month of 2 July 2024, confirming that they would either:

  • Commit to applying for a license by meeting the requirements outlined in the secondary legislation under the Law Amendment; or
  • Resolve to liquidate within three months, ensuring no losses to clients and refraining from onboarding new clients during this period.

 

For any operations launched after 2 July 2024, a declaration must be filed with the CMB, stating that the requirements determined by the secondary legislation of the Law Amendment will be met and an application will be made to obtain a license.

2. How quick and easy is to get a MiCA licence in Turkiye? 

N/A

3. Are the following activities regulated or unregulated in your jurisdiction? ― Direct sales of tokens by issuers — Exchange (buy/sell) ― Custody (hold) ― Borrowing/lending ― Yield/staking services ― Staking on proof of stake consensus mechanisms (please indicate if NFTs are treated differently from fungible cryptoassets for each activity)

AML RegulationAny other regulation

 

These activities are unregulated.

 

Direct sales of tokens by issuers

 

Direct sales of certain tokens, such as security tokens, fall within the scope of the Law. Crypto-asset service providers involved in these activities must obtain a license from the CMB.

 

Exchange (buy/sell)

 

The Law applies same regulations for exchanges (buy/sell) as for direct sales. Crypto-asset service providers engaged in this activity must also obtain a license from the CMB.

 

Custody (hold)

 

Crypto-asset service providers offering custody services must obtain a license from the CMB.

 

Borrowing/lending

 

The CMB Resolution dated 19 September 2024 prohibits platforms from engaging in lending transactions, providing credit to customers, and offering leveraged transactions.

 

Yield/staking services

 

Currently, there is no explicit regulation governing yield or staking services.

 

Staking on proof-of-stake consensus mechanism

 

This activity is also not explicitly regulated.

 

NFTs

 

According to the CMB Resolution dated 19 September 2024, activities related to NFTs, including buy/sell, first sale or distribution, exchange, transfer, and custody, are outside the scope of the Law. Businesses offering these services must inform clients that they are not under CMB supervision or control. It remains unclear whether other laws or regulatory bodies other than CMB will address these activities in the future. 

4. Can offshore business provide services to local customers on either active solicitation or reverse solicitation basis? 

AML RegulationAny other regulation

 

N/A. 

The Law underlines that engaging in activities directed at residents in Türkiye by crypto-asset platforms based abroad is considered unauthorised crypto-asset service provision. Establishing a website in Turkish language, conducting promotional and marketing activities related to the services directed at residents in Türkiye and establishing a workplace in Türkiye are considered activities directed at residents in Türkiye.

 

Foreign-based platforms must either cease their activities directed at residents of Türkiye or establish a joint-stock company in Türkiye and obtain a licence from the CMB to continue providing services to Turkish residents.  

5. How long would establishing a cryptoasset business/obtaining a license in your jurisdiction take?

AML RegulationAny other regulation

 

N/A.

Since not all requirements for obtaining a licence have been published, crypto-asset service providers are currently required to submit a declaration to the CMB confirming that both they and their services align with the regulatory requirements in effect and that they intend to apply for a licence with the CMB.

6. What would be the approximate overall cost of obtaining a licence?

AML RegulationAny other regulation

 

N/A.

 

The regulations do not specify the cost of obtaining a licence directly. However, crypto-asset platforms must have a minimum paid-up capital of TRY 50 million in cash, which the platform’s equity cannot fall below. Additionally, crypto-asset trading platforms must pay an annual fee of 1% of their total income, excluding interest income, to both the Capital Markets Board (CMB) and the Scientific and Technological Research Council of Türkiye (TUBITAK), making for a total fee of 2% per year. 

 

These requirements indicate significant financial commitments for any crypto-asset service provider aiming to operate under the new regulations.

7. What is the probability (%) of success in obtaining a licence?

N/A.

8. What other limitations are there in your jurisdiction when looking to set up a cryptoasset business? E.g., Compliance requirements and physical presence

AML RegulationAny other regulation

 

Under the AML Law, the cryptoasset service providers must comply with and fulfil certain requirements including but not limited to applying KYC procedures, reporting transactions that raise suspicions of money laundering or the funding of terrorist activities, providing information and documents to the Financial Crimes Investigation Board upon request, and preserving records for submission to the relevant authorities upon request.

Certain limitations are imposed on payment service providers and payment and electronic money institutions under the Regulation on the Disuse of Crypto-assets in Payments. Accordingly:

  • payment service providers cannot develop business models that involve the direct or indirect use of crypto-assets in the provision of payment services and the issuance of electronic money, nor can they offer any services related to such business models, and
  • payment and electronic money institutions are prohibited from acting as intermediaries for platforms that offer trading, custody, transfer, or issuance services for crypto-assets, or for fund transfers made from these platforms.

 

The Law

 

Some of the key provisions of the Law are listed below.

  • Crypto-asset service providers must apply to the Turkish Capital Markets Association to become members within three months after obtaining their certificates. The activities of crypto-asset service providers that fail to fulfil this membership obligation will be ceased by the CMB.
  • The Law sets forth requirements for the shareholders, directors, representatives of the crypto-asset service providers.
  • The articles of association of crypto-asset service providers must stipulate that their activities are limited to crypto-asset trading, initial sale or distribution, custody, etc.
  • The phrase “crypto-asset trading platform” should be included in the trade names of crypto-asset service providers to indicate the services they will offer.
  • The shareholding structure should be transparent and open.
  • If crypto-asset service providers fail to meet their transfer obligations or if their financial structure weakens, the CBM can take various measures, up to and including the withdrawal of the licences of crypto-asset service providers.
  • In response to certain unauthorized activities on the Internet, the CMB may decide to block access to the offending site or to remove the content.

 

Individuals and individual representatives of entities who conduct unauthorized crypto-asset service activities will be subject to imprisonment for three to five years and a judicial fine ranging between TRY 500,000 to TRY 5,000,000.