Turkey is swiftly advancing its efforts to regulate cryptocurrency assets, according to the country’s Finance Minister, Mehmet Şimşek. In his address to the nation’s planning and budget commission on October 31st, Şimşek revealed the government’s determination to formalize crypto assets within the national financial framework. This move comes after the nation found itself on the Financial Action Task Force [FATF] grey list in 2021, subjecting the nation to heightened scrutiny. Being on this list has posed significant challenges for Turkey, hindering its ability to attract foreign investments, especially during a period of existing economic difficulties.
The FATF had criticized Turkey for its failure to implement effective measures to combat money laundering and terrorist financing, resulting in the exploitation of the country’s financial system by various criminal entities, including mafia groups, drug traffickers, organized crime syndicates, and terrorist organizations, over the past decade. A report issued by the global agency in July 2023 highlighted Turkey’s continued strategic deficiencies in meeting the FATF’s recommendations.
To address these concerns and enhance its anti-money laundering and counter-terrorist financing efforts, Turkey has decided to incorporate digital assets into its tax framework. This decision, outlined in the 2024 Presidential Annual Program, signifies a significant shift in the government’s approach to cryptocurrencies. After years of deliberation, this move is poised to bring about substantial changes in the country’s economic policies.
Turkey Minister Says Crypto Laws On The Final Stages
According to Şimşek, Turkey has successfully adhered to “39 out of 40 FATF standards.” He stated, “Regarding technical compliance, the only ongoing preparations are related to work on crypto assets. Our necessary efforts in this regard have reached the final stage.” He further added, “We will submit a law proposal on crypto-assets to the parliament as soon as possible. After that, there will be no reason for Turkey to remain on the grey list, provided there are no other political considerations.”
This proactive approach by the Turkish government signals its commitment to addressing the challenges posed by unregulated cryptocurrency activities. By integrating digital assets into the tax framework and preparing a comprehensive legislation proposal, Turkey aims to bolster its financial system’s integrity, attract investments, and strengthen its position on the global economic stage.