Bitcoin fell early on Friday, after Turkey’s central bank decided to ban the use of cryptocurrencies for payments from the end of the month.
The Central Bank of the Republic of Turkey (CBRT) cited several reasons for the ban, including the lack of “supervisory mechanisms” and “regulation by the central authority” of cryptographic assets.
He said market values can be “excessively volatile,” adding that digital wallets can be stolen or used illegally and that transactions were irrevocable.
The reference cryptocurrency BTCUSD,
fell 4% to $ 60,902, after hitting record highs above $ 64,000 earlier this week ahead of cryptocurrency exchange platform Coinbase’s COIN,
initial public offering. Ether ETHUSD,
the second most prominent cryptography in the world, also fell 3.9%.
“Payment service providers may not develop business models in such a way that cryptographic assets are used directly or indirectly in the provision of payment services and the issuance of electronic money and may not provide any services related to such payment models. business “, according to the new regulation.
The CBRT said it had made the decision amid an increase in the use of cryptographic assets to make payments.
Last month, Tesla chief executive Elon Musk said Americans could buy a Tesla with bitcoin and that people outside the United States could do the same later this year. Tesla TSLA electric car manufacturer,
he said he acquired bitcoin worth $ 1.5 billion in February, announcing plans to use it as a form of payment as well. PayPal PYPL online payment service,
it also began allowing U.S. customers to buy cryptocurrency items in late March.
But the CBRT said payments for cryptocurrencies involved “significant risks.”
“It is considered that use in payments may cause irrecoverable losses for the parties to the transactions due to the factors mentioned above and include elements that may undermine confidence in the methods and instruments currently used in payments,” he said.
Turkey is not the only country that wants to take tough action on digital assets. India is reportedly proposing a law banning cryptocurrencies and making trade or even the possession of assets punishable by a fine. The bill was included in the government agenda in January, which also referred 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 allows for certain exceptions to promote the underlying cryptocurrency technology and its uses,” according to the agenda.