Turkey’s Industry and Technology Minister said that he recently changed his attitude towards cryptocurrencies and spoke about the government’s plans to regulate the industry.
In an interview with Bloomberg HT, Turkey’s Industry and Technology Minister Mustafa Varank said the government will soon introduce rules to regulate cryptocurrencies. He added that he “no longer has a negative attitude towards cryptocurrencies” and “understands that they are effective.”
However, Varank noted that “cryptocurrencies are used for fraud” and the government “will not allow the industry with such high risks to operate uncontrollably.” Varank’s remarks followed President Recep Erdogan’s announcement that the government is currently working on a plan to create an economic and legal framework for cryptocurrencies.
Mehmet Türkarslan, a legal advisor for Turkish cryptocurrency exchange Paribu, said the industry is aware of the scams that novice traders are subjected to by bogus financial advisors promising high returns on cryptocurrency investments.
“These so-called consultants initially help their unsuspecting clients to make solid profits and, having won their trust, encourage their victims to give them access to their accounts on the cryptocurrency exchange,” Turkarslan said.
Scammers tell their victims that they can help them make even more profit if they are allowed direct access through TeamViewer to accounts on cryptocurrency exchanges. “Having gained access to the victim’s device and accounts, they transfer money to their accounts and simply disappear,” Turkarslan explained.
“Fraud is a serious problem in the Turkish cryptocurrency market and around the world,” said Beste Naz Süllü, research director at ICRYPEX cryptocurrency exchange. “The government’s commitment to combat them through regulation is well received by the entire industry.”
However, it is not yet clear what regulatory measures will be taken to stop the fraud. “This is a difficult question, because clients give full access and explicit consent to the work of these consultants,” Turkarslan said.
According to him, Turkish cryptocurrency exchanges have repeatedly told the government that a golden mean is needed in regulating the industry. The imposition of an excessive tax on cryptocurrency may simply push citizens to look for loopholes through foreign exchanges that the government cannot regulate.
“Such an arbitrary move could have frightening consequences for the local cryptocurrency industry, and the government could simply lose revenue,” Turkarslan said. “There is a global trend towards regulating cryptocurrencies as assets rather than alternative currencies, and we definitely hope that the Turkish government will also take this approach.”
Earlier this month, it became known that the Turkish Ministry of Finance began working on the regulation of the cryptocurrency industry in conjunction with the Central Bank.
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