The cryptocurrency market took a hit on Friday after the Turkish central bank announced a ban on cryptocurrency payments. The bank mentioned that crypto transactions involve significant risks.
According to the announcement by the central bank of the Republic of Turkey published in the official Gazette, cryptocurrency assets cannot be used as a mode of payment. The ban will come into effect on 30 April.
The central bank also outlined that payment companies will not be able to provide deposit and withdrawal services to cryptocurrency exchanges.
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“Payment service providers may not develop business models or provide any services related to such business models in a way that crypto assets are used directly or indirectly in the provision of payment services and the issuance of electronic money. Payment and electronic money institutions may not mediate the transfer of funds to or from platforms that provide trading, storage, transfer or issuance services related to cryptocurrency assets,” the official announcement states.
Finance Magnates earlier reported a crash in the Turkish Lira and a surge in queries related to Bitcoin and other digital currencies. In March 2021, Bitcoin-related queries spiked nearly 500% within hours after the news of the crash in Turkey’s national currency.
Impact on Cryptocurrency Market
The latest news came as a surprise for the cryptocurrency market as Turkey is one of the fastest-growing crypto destinations. The country saw a massive jump in the adoption of digital currencies amid high inflation and a significant drop in the value of Turkey’s national currency. The overall market cap of cryptocurrency assets dropped nearly 3% in the last 24 hours. Bitcoin, the world’s most valuable digital currency, is currently trading near $61,000 with a market cap of more than $1.1 trillion. Ethereum is currently trading at around $2,400, which is down approximately 4% in the last 24 hours. Ethereum crossed $2,500 yesterday after a massive jump in demand from retail and institutional investors.
The total market value of cryptocurrency assets stands at around $2.2 trillion.