Crypto in Turkey

Turkey's crypto regulatory framework is defined by a 2021 ban on cryptocurrency payments, introduced via the Central Bank of Turkey's Regulation on the Disuse of Crypto Assets in Payments, published in the Official Gazette on April 16, 2021. This regulation prohibits the use of crypto assets for payments, either directly or indirectly, but does not ban trading or holding. The Capital Markets Board (CMB) has since taken a more active role, and in 2024, draft legislation was proposed to regulate crypto asset service providers, aiming to align with FATF standards. The Central Bank of Turkey oversees monetary policy and has been exploring a central bank digital currency, the Digital Lira, which entered pilot testing in 2023. Despite the payment ban, crypto trading remains legal, with exchanges operating under AML/CFT obligations enforced by the Financial Crimes Investigation Board (MASAK).

Turkey has not enacted specific cryptocurrency tax legislation. The Turkish Tax Procedure Law (VUK) does not explicitly classify crypto assets, creating ambiguity. The Revenue Administration (GİB) has issued guidance stating that crypto trading profits should be declared as income, but enforcement is inconsistent. For individuals, gains from crypto trading may be considered as 'incidental income' and taxed at progressive rates from 15% to 35% under Income Tax Law No. 193. However, in practice, few traders report crypto gains due to lack of third-party reporting and clear rules. Corporate entities holding crypto must account for them under general provisions, but no specific rate applies. In 2024, the government announced plans to introduce a crypto tax bill, but as of mid-2025, no draft has been presented to parliament. The absence of a clear tax framework remains a significant deterrent to institutional adoption.

Turkey ranks among the top countries globally in crypto adoption, with over 5 million users, according to 2023 estimates by Chainalysis. The lira's depreciation—losing more than 80% of its value against the dollar since 2021—has driven retail investors to cryptocurrencies as a hedge. Trading volumes on local exchanges like BtcTurk and Paribu surged during periods of lira volatility; in 2023, daily volumes often exceeded $1 billion. Institutional activity is limited due to regulatory uncertainty, but some family offices and high-net-worth individuals allocate to crypto. Use cases are dominated by trading and wealth preservation, with stablecoins particularly popular for savings. Despite the payment ban, peer-to-peer and over-the-counter trading remain active. The Digital Lira pilot, involving the Central Bank and technology partners, aims to provide a state-backed digital alternative, but adoption is nascent.