Turkey Implements 48-Hour Crypto Withdrawal Delay to Combat Financial Crimes

Turkey is preparing to implement stricter regulations on cryptocurrency transactions to combat financial crimes. The new measures, announced by the Ministry of Treasury and Finance, led by Finance Minister Mehmet Şimşek, are aimed at curbing crypto-enabled money laundering, illegal betting, and fraud.

The regulations will require virtual asset service providers (VASPs) to collect and share sender or recipient identity details for non-compliant transfers. This move is part of a broader effort to increase transparency and ensure that cryptocurrency platforms are not being used for illicit activities. Additionally, a 48-hour delay will be applied to most crypto withdrawals, increasing to a 72-hour delay for first-time withdrawals from any account. This cooling-off period is designed to deter illegal fund movements.

Platforms will also be required to have a 20+ character transaction description, including the origin and purpose of each transfer. Any non-compliance with these regulations will result in administrative, legal, and financial penalties, including possible license revocation. However, transfers associated with providing liquidity, market-making, and arbitrage will be excluded from these restrictions, provided they are under platform monitoring.

Furthermore, there are limits on stablecoin transfers, with a daily cap of $3,000 and a monthly cap of $50,000. Providers that fully comply with the rules may get double these limits. These measures are aimed at preventing large-scale financial fraud and ensuring that stablecoins are used responsibly.

Turkey's regulatory overhaul is part of its ongoing efforts to combat financial crimes. In March, the country passed new crypto laws under its Capital Markets Board, introducing stricter licensing, custody safeguards, and compliance requirements. A month earlier, a rule that VASPs must verify users for transactions above 15,000 TL (approximately $425) was implemented.

Turkey ranks among the top global crypto adopters, driven by inflation and lira devaluation. Despite the central bank's ban on payments using crypto, the number of people familiar with cryptocurrencies and Bitcoin has significantly increased in recent years. The withdrawal delays and stablecoin limits could deter short-term speculative trading, but Turkey is looking to strike a balance that still allows legitimate activity.

Overall, Turkey's move to enforce stricter crypto regulations is a proactive step towards combating financial crimes. By increasing oversight and implementing stringent measures, the government aims to create a safer and more secure environment for cryptocurrency transactions, ultimately benefiting both users and the broader financial system.