Turkey Imposes 48-Hour Withdrawal Delays on Crypto Transactions

Turkey has implemented a series of stringent regulations aimed at curbing money laundering and enhancing financial oversight in the cryptocurrency sector. The new measures, introduced by the Ministry of Treasury and Finance, are designed to prevent illicit funds from being laundered through crypto asset transactions. These regulations include requirements for crypto users to declare the source and purpose of transfers, the implementation of withdrawal delays, and the setting of limits on daily stablecoin activity.

One of the key provisions of the new regulations is the mandatory inclusion of a minimum 20-character transaction description for all cryptocurrency transfers. This requirement is intended to allow authorities to trace the source and intent of each operation, thereby enhancing transparency and accountability. Crypto Asset Service Providers (CASPs) will be responsible for collecting and reporting this data as part of their enhanced due diligence procedures.

To further slow the movement of suspicious funds, the regulations stipulate that withdrawals made after purchases or swaps will be delayed by at least 48 hours if the travel rule, which requires sender and receiver ID verification, is not applied. For new accounts or first-time withdrawals, this delay extends to 72 hours. These measures are aimed at providing authorities with sufficient time to investigate and verify the legitimacy of transactions.

The new rules also target stablecoins, which are often used in fraudulent transfers due to their price stability and liquidity. Under the regulations, the daily stablecoin transfer limit is set at $3,000, with a monthly transfer limit of $50,000. However, CASPs that fully comply with travel rule obligations may double these limits, providing an incentive for platforms to ensure full compliance.

Treasury and Finance Minister Mehmet Şimşek emphasized that these measures are not intended to hinder legitimate crypto activity. He stated that the regulations aim to bring transparency to crypto transactions without undermining the innovation and economic value of the crypto ecosystem. Users conducting verifiable activities such as liquidity provision, market-making, or cross-market arbitrage will be able to transact without limits, provided platforms ensure compliance and oversight.

Platforms that fail to comply with the new framework will face administrative penalties, including the denial or revocation of licenses. Şimşek stressed the importance of full compliance to safeguard user security and maintain the integrity of the financial system. The regulations are part of a broader effort to enhance financial oversight and prevent the misuse of cryptocurrencies for illicit activities.

Turkey’s move comes as its national currency lira has depreciated by 20.18% over the past year. Although this fall back fueled crypto adoption across the country, the new restrictions may slow trading and raise compliance costs. While the 72-hour delay on withdrawals and a little stablecoin cap could deter short-term speculative trading, fully compliant platforms might continue to attract institutional inflows, bolstered by growing investor confidence following U.S. Bitcoin ETF approvals in 2024.