The Turkish government is reportedly drafting legislation to grant its financial crime agency, Masak, the power to freeze cryptocurrency accounts as part of a broader initiative to tackle money laundering and financial crime — a development that underscores regulators’ persistent worries regarding illicit activities linked to crypto.
As reported by Bloomberg, citing sources familiar with the topic, the proposed amendments would broaden Masak’s Anti-Money Laundering (AML) powers, allowing it to freeze traditional bank accounts alongside cryptocurrency ones.
The initiatives are said to align with the guidelines established by the Financial Action Task Force (FATF), an intergovernmental organization that sets international standards for fighting money laundering and financing terrorism.
The bill is anticipated to be presented in the Grand National Assembly, though no specific timeline has been mentioned, as per Bloomberg.
If enacted, Masak would gain the authority to freeze or shut accounts suspected of illegal activities within payment systems, electronic money institutions, banks, and cryptocurrency exchanges. It would also have the ability to impose transaction limits or blacklist crypto wallets associated with criminal behavior.
A primary goal of the legislation is to address the increase of so-called “rented accounts” — accounts that are exploited by criminals who pay users for their use in illegal gambling or financial fraud.
While cryptocurrency trading and investing remain legal in Turkey, with profits currently not subject to taxation as of October, the government is tightening oversight measures.
As reported by Cointelegraph, the Finance Ministry is developing new regulations requiring crypto exchanges to gather detailed information on transaction sources and purposes, along with imposing limits on stablecoin transfers.
In July, the Capital Markets Board (CMB), one of Turkey’s principal financial oversight bodies, announced it had blocked access to several platforms providing “unauthorized” digital asset services, including PancakeSwap, a well-known decentralized exchange.
Related: Crypto payments abroad may be legal despite domestic bans in several countries
Turkish crypto adoption on the rise
Cryptocurrency adoption in Turkey has been steadily increasing, bolstered by the rise of centralized retail platforms and the growing availability of institutional crypto services in the country, according to the latest Chainalysis Global Crypto Adoption Index released in September.
One of the most significant factors driving adoption has been the sharp decline of the Turkish lira, which has experienced a steady drop since 2018 amid a prolonged financial crisis characterized by high inflation, escalating borrowing costs, and loan defaults.
As the value of the lira diminishes, many citizens have turned to dollar-pegged stablecoins and Bitcoin (BTC) as alternative means of storing value.
To illustrate the extent of the lira’s decline: In 2020, a single Bitcoin was worth roughly 100,000 Turkish lira. Today, that amount surpasses 4.6 million lira, reflecting both the appreciation of Bitcoin’s price and the lira’s significant depreciation.
Related: Singapore, UAE are the ‘most crypto-obsessed’ countries: Report
