Bitcoin fell early on Friday after Turkey’s central bank decided to ban the use of cryptocurrencies for payments at the end of the month.
The Central Bank of the Republic of Turkey (CBRT) cited a number of reasons for the ban, including the lack of “supervisory mechanisms” and “regulation of the central authority” for cryptographic assets.
He said market values could be “excessively volatile”, adding that digital wallets could be stolen or used illegally and that transactions were irrevocable.
BTCUSD reference cryptocurrency,
fell 4% to $ 60,902 after hitting historic highs of more than $ 64,000 earlier this week ahead of cryptocurrency exchange Coinbase COIN,
initial public offering. Ether ETHUSD,
the second most prominent cryptocurrency in the world, also fell by 3.9%.
“Payment service providers may not develop business models so that cryptographic assets are used directly or indirectly in the provision of payment services and the issuance of electronic money and may not provide services related to such business models,” according to the new regulation. .
The CBRT said it had made the decision amid increasing use of cryptographic assets to make payments.
Last month, Tesla CEO Elon Musk said Americans could now buy a Tesla with bitcoin and that people outside the US could do the same later this year. Manufacturer of electric cars Tesla TSLA,
said it bought 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 US customers to purchase cryptocurrency items in late March.
However, the CBRT said payments for cryptographic assets posed “significant risks”.
“It is considered that use in payments may cause irrecoverable losses to the parties to transactions due to the factors listed above and include elements that may undermine confidence in the methods and tools currently used in payments,” he said.
Turkey is not the only country that wants to take tough action on digital assets. It seems that India should propose a law banning cryptocurrencies and make the trading or even possession of assets punishable by a fine. The bill was included in a 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 certain exceptions to promote basic cryptocurrency technology and its uses,” according to the agenda.