Turkey Moves to Expand Watchdog Powers Over Crypto, Bank Accounts

Turkey is drafting legislation to enhance its financial intelligence unit, Masak, enabling it to freeze bank and crypto accounts associated with suspected criminal activities. This proposed bill would allow Masak to shut down accounts, limit transaction amounts, and blacklist crypto wallet addresses across financial institutions and exchanges. The measures aim to combat illegal activities, particularly concerning 'rented accounts' used for fraud and gambling. The initiative follows the removal of Turkey from the Financial Action Task Force's 'grey list' in June 2024. Experts caution that such regulations could raise compliance costs for crypto platforms and drive users towards decentralized alternatives. However, institutional interest in crypto might grow if regulations are transparently and predictably implemented. As crypto adoption rises in Turkey amid high inflation, this legislative push represents both a regulatory effort and a response to increasing engagement in the crypto market.

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