The new ban in Turkey will prevent cryptocurrency holders from using their digital assets for payment, and will also prevent payment providers from providing fiat data to exchange digital currency.
According to a statement from the Central Bank of the Republic of Turkey on Friday, the ban will take effect on April 30 and make decisions on the payment of cryptocurrencies and partnerships illegal.
The bank said that “any direct or indirect use of cryptocurrencies in payment services and the issuance of electronic money” will be prohibited.
Although banks are exempt from regulation, which means that users can still deposit Turkish lira on cryptocurrency exchanges using bank transfers from bank accounts, payment service providers will not be able to offer deposit or withdrawal services for cryptocurrency exchange.
Payment systems and digital wallets are widely used in Turkey to transfer paper money to cryptocurrency exchanges and vice versa. Large global exchange company Binance collaborated with the local payment provider Papara when it first entered the Turkish market to offer lira across different cryptocurrencies.
This new regulation means that users have two weeks to clear their balance if they only use payment providers as cryptocurrency gateways.
Historically, the payment system has been closely controlled by the Turkish government. In 2016, Turkey banned the country’s largest global payment provider PayPal.
Cryptocurrency regulation has been a hot topic for Turkey in recent months. Last month, Turkey’s Ministry of Finance and Finance announced that it controls the cryptocurrency system and cooperates with the central bank, the Banking and Supervision Bureau and the Capital Markets Council to regulate cryptocurrencies.