Bitcoin price down after Turkey’s central bank bans crypto payments

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The price of bitcoin (BTC) fell from record peaks Friday after a ruling by Turkey’s central bank to restrict the use of cryptocurrencies as a mode of payment.

The Central Bank of the Republic of Turkey (CBRT) has announced that the use of cryptocurrencies and other related digital assets would be banned, directly or indirectly, as an instrument of payment.

The CBRT cited possible “irreparable” damage and significant risks in transactions in a move that pulled back bitcoin’s price rally. The ban will come into effect starting April 30 this year.

Increase in momentum

Turkey’s growing digital currency market has gained a lot of traction in recent months as investors joined a worldwide adoption of the crypto, seeking to hedge against the depreciation of its native currency lira and inflation, which surpassed 16% last month.

“Payment service providers won’t be able to develop business models in a way that crypto assets are used directly or indirectly in the provision of payment services and electronic money issuance,” IT Pro UK quoted CBRT as it stated in the legislation.

The central bank pointed out that the ban was motivated by a lack of “supervision mechanisms” and “central authority regulation” for cryptocurrencies and other similar virtual assets. Prior to the ban, Turkish regulators demanded user information from crypto trading platforms.

Opposing the ban

Bitcoin, the world’s leading cryptocurrency, was off almost 3% at $61,490 against the U.S. dollar at 0754 GMT following the announcement of the ban, which was slammed by Turkey’s main opposition bloc.

Ethereum (ETH), the world’s second-biggest cryptocurrency, maintained its multi-month advance Thursday, registering a record high of $2,488.07. ETH was down almost 2% on Friday morning.

The restriction goes against the pace that bitcoin has gathered in the past few months, which comprises an increase in valuation that is coherent with a string of companies throwing their support for cryptocurrencies on their business platforms.

Image courtesy of Karolina Grabowska/Pexels

Jet Encila

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Jet Encila

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