The Central Bank of Turkey banned the use of cryptocurrencies to purchase goods and services, citing potential "irreparable" damage and significant risks in such transactions.
According to Reuters, the Telegraph reports, in the legislation published in the Official Gazette during the day, the Central Bank of Turkey (CBRT) said that cryptocurrencies can not be used, directly or indirectly, as a payment instrument.
"Payment service providers will not be able to develop business models in a way that cryptocurrencies can be used directly or indirectly in providing payment services and issuing electronic money and will not be able to provide any services related to such business models ", the bank is quoted as saying.
A growing boom in Turkey's cryptocurrency market had gained momentum recently, with investors hoping to profit from bitcoin and "shelter" against inflation.
Meanwhile, this medium points out, a weaker Turkish lira and inflationary pressures have also increased the demand for cryptocurrency.
In a statement explaining the reason for the ban, the bank said the assets "were not subject to any regulatory and supervisory mechanism, or a central regulatory authority", among other security risks.
"It is considered that their use in payments may cause irreversible losses to the parties to the transaction due to the above factors and they include elements that may undermine confidence in the methods and instruments currently used in payments," the central bank said in a statement.
Otherwise, Turkey's annual inflation rose above 16% in March.
The legislation will be in effect from April 30, and as might be expected, Bitcoin dropped 1.7% to $ 61.733.00
Will Turkish citizens and businesses cash out on crypto that is another thing. Personally I think things will not change much