Erdogan Is Planning a Massive Turkey Crypto Crackdown

The crypto market in Turkey is facing turbulence as President Recep Tayyip Erdogan pushes for stricter regulations targeting digital assets. Reports from Bloomberg reveal that new legislation could empower Turkey’s Financial Crimes Investigation Board (MASAK) to freeze crypto accounts without court orders, sparking fears across the local crypto market.

With Turkey ranking among the top 15 crypto-adopting nations, over $ 170 billion in trading volume was recorded in 2023 alone. Now, the government aims to curb illegal betting, fraud, and tax evasion, raising concerns about market freedom and investor confidence.

Will these actions create stability or trigger FUD and a potential sell-off in the overall crypto price landscape?

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Why Is Erdogan Targeting Crypto Now?

The proposed crackdown comes amid soaring inflation and ongoing economic instability, driving millions of Turks to use crypto as a hedge against the rapidly devaluing lira. According to Chainalysis, Turkey has one of the highest crypto adoption rates globally, with Bitcoin BTC $113,719.43 1.42% Bitcoin BTC Price $113,719.43 1.42% /24h Volume in 24h $51.89B Price 7d Learn more  and stablecoins like USDT and USDC widely used for savings and remittances.

(Source – Chainalysis)

However, this explosive growth has drawn government scrutiny. Finance Minister Mehmet Simsek confirmed that MASAK would soon gain enhanced powers to fight money laundering, particularly from illegal betting platforms and fraud operations. Under the new framework:

• Transactions above 15.000 lira (~$450) will require strict KYC checks and documented explanations.
• MASAK will have the authority to freeze crypto and bank accounts linked to suspicious activity without prior court approval.
• Stablecoin transfers will face stricter limits to prevent unregulated capital flight
• Exchanges must report and track transactions, with heavy penalties for non-compliance.

The timeline for these measures builds on previous regulatory milestones:

• February 2025: Full AML rules took effect, requiring crypto firms to obtain licenses and comply with ongoing audits.
• July 2025: Authorities blocked 46 unlicensed exchanges, including major DEX platforms like PancakeSwap.
• July 28, 2025: The founder of ICRYPEX, a major Turkish exchange, was detained, with allegations linking crypto funding to government critics.

These steps align with international standards like the EU’s MiCA framework, but critics argue they also serve as a political tool. Opposition figures claim the government is using crypto regulations to target dissent, pointing to a wider crackdown on media and political rivals like Istanbul Mayor Ekrem Imamoglu, who has faced repeated legal action.

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