Turkey is reportedly in the process of formulating new regulations concerning crypto assets in a strategic move to persuade the Financial Action Task Force (FATF) to remove the country from its "grey list." The FATF, an international organization dedicated to combating financial crime, placed Turkey on the grey list in 2021 due to concerns about money laundering and terrorist financing.
According to reports, Turkish Finance Minister Mehmet Simsek shared during a discussion with a parliamentary committee on October 31 that a FATF report found Turkey to be in compliance with all but one of the 40 standards established by the watchdog. He indicated that the sole outstanding issue pertains to crypto assets. Simsek mentioned plans to propose a new law on crypto assets to the parliament, without delving into specific legal changes.
The FATF, initially created by the Group of Seven (G7) advanced economies, has a primary mission of safeguarding the international financial system. In 2019, the FATF had previously cautioned Turkey about significant deficiencies in the procedures for freezing assets related to terrorism and the proliferation of weapons of mass destruction.
Turkey's Annual Plan for 2024, outlined in the Official Gazette of the Republic of Turkey on October 25, sets the objective of finalizing cryptocurrency regulations in the country by the end of 2024. Section 400.5 of the 500-page comprehensive document outlines the intended efforts to establish a clear definition of crypto assets that may potentially be subject to taxation in the future. The document also aims to legally define cryptocurrency asset providers, including cryptocurrency exchanges. However, it does not provide further specifics on the forthcoming regulatory framework.
As of December 2022, the Central Bank of the Republic of Turkey had successfully conducted initial trials of its central bank digital currency, known as the digital lira, with further testing scheduled for 2024.
