Bitcoin fell early Friday after Turkey’s central bank decided to ban the use of cryptocurrencies for end – of – month payments.
The Central Bank of the Republic of Turkey (CBRT) cited a number of reasons for the ban, including a lack of “supervisory mechanisms” and “central government regulation” for crypto-assets.
Market values are said to be “excessively volatile”, adding that digital wallets can be stolen or used illegally and that transactions were irrevocable.
The benchmark cryptocurrency BTCUSD,
declined 4% to $ 60,902 after hitting a high of $ 64,000 earlier this week, ahead of the currency of the cryptocurrency exchange platform Coinbase,
initial public offering. Ether ETHUSD,
the second most prominent crypto in the world, also fell by 3.9%.
“Payment service providers may not develop business models in such a way that crypto-assets are used directly or indirectly in the provision of payment services and electronic money issuance, and may not provide any services related to such business models,” according to the new regulation.
The CBRT said it made the decision amid an increase in the use of cryptocurrencies to make payments.
Last month, Eles Musk, CEO of Tesla, said that Americans can now buy a Tesla with bitcoin and that people outside the US will be able to do so later. Electric car manufacturer Tesla TSLA,
said they purchased $ 1.5 billion worth of bitcoin in February, and announced that they would use it as a means of payment as well. Online payment service PayPal PYPL,
also had US customers buy cryptocurrencies at the end of March.
But the CBRT said there were “significant risks” associated with crypto-asset payments.
“It is considered that the use of payments could cause the parties to the transactions due to the above factors, non-recoverable losses and it contains elements that could undermine confidence in the methods and instruments currently used in payments,” he said. he said.
Turkey is not the only country that wants to take strict measures on digital assets. It is understood that India is going to propose a law that will ban and trade cryptocurrencies or even hold assets liable. The bill was included in a government agenda in January, which also refers to plans to create an official digital currency issued by the Reserve Bank of India. “The bill also seeks to ban all private cryptocurrencies in India, but it provides for certain exceptions to promote the underlying technology of cryptocurrency and its use,” according to the agenda.