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Turkish Government Plans Central Custodian Bank to Manage Crypto Risk: Report
Authorities are also contemplating a capital threshold for crypto exchanges and education requirements for the executives at the firms, Bloomberg said, citing an unnamed official.
The Turkish government plans to create a central custodian bank to eliminate counterparty risk following the collapse of two cryptocurrency exchanges last week, and as the country seeks to tighten its grip on the industry, Bloomberg reported, citing a senior official familiar with the plans.
STORY CONTINUES BELOW
- Authorities are also contemplating a capital threshold for crypto exchanges and education requirements for the executives at the firms, Bloomberg said, citing the unnamed official.
- The report comes days after Trade Moneta reported the head of Turkey’s central bank ruled out a total prohibition of cryptocurrencies and said a wide range of crypto regulations is coming within two weeks.
- Those comments came days before a ban on the use of cryptocurrencies for payments is due to go into effect Friday. The announcement of the ban, which came as the use of cryptocurrencies in the nation has soared due to the plunging lira, drew protests from the government's political opponents.
- The fact is, completely prohibiting crypto in Turkey is almost impossible to do. Local media reported that in the beginning of 2021, moving in tandem with the bitcoin price run, the country’s two largest crypto exchanges, Paribu and BtcTurk, were trading over $1 billion worth of crypto daily.
- According to local reports, the total volume of crypto traded in January accounted for around 25% of the traded volume on the country’s stock exchange BIST.
- The comments came shortly after the collapse and detention of employees of two crypto exchanges that are being investigated by the government.
Kevin Reynolds
Kevin Reynolds was the editor-in-chief at CoinDesk. Prior to joining the company in mid-2020, Reynolds spent 23 years at Bloomberg, where he won two CEO awards for moving the needle for the entire company and established himself as one of the world's leading experts in real-time financial news. In addition to having done almost every job in the newsroom, Reynolds built, scaled and ran products for every asset class, including First Word, a 250-person global news/analysis service for professional clients, as well as Bloomberg's Speed Desk and the training program that all Bloomberg News hires worldwide are required to take. He also turned around several other operations, including the company's flash headlines desk and was instrumental in the turnaround of Bloomberg's BGOV unit. He shares a patent for a content management system he helped design, is a Certified Scrum Master, and a veteran of the U.S. Marine Corps. He owns bitcoin, ether, polygon and solana.
Sandali Handagama
Sandali Handagama is CoinDesk's deputy managing editor for policy and regulations, EMEA. She is an alumna of Columbia University's graduate school of journalism and has contributed to a variety of publications including The Guardian, Bloomberg, The Nation and Popular Science. Sandali doesn't own any crypto and she tweets as @iamsandali
