Turkey’s President Erdoğan declares war against Bitcoin

  • Turkey could possibly take a China-like measure outrightly banning any crypto transactions or trading activities in the country.
  • The Turkish Central Bank has accelerated its work on CBDC Digital Lira.

Just as Bitcoin (BTC) continues to gain more market acceptability, some government institutions are not liking it. Turkey is one of them. Last Saturday, September 18, Turkey’s President Tayyip Erdogan declared war against Bitcoin.

A lot of Turkish citizens have been moving to Bitcoin with the value of the Lira dropping sharply over the last year. Erdogan’s comments came at a time when the President was attending a meeting with students in Mersin.

One of the participants at the event asked whether if the Turkish central bank was interested in opening up to cryptocurrencies. Responding to it, the President said: “We are in a war against Bitcoin”.

Is a Bitcoin ban coming?

This pretty much sounds like Turkey can issue an outright ban on crypto going forward. Turkey’s crackdown on cryptocurrencies already started earlier this year. Back in April 2021, the Turkish government banned the use of crypto to make payments in the country.

On the other hand, the Turkish central bank is preparing to launch a platform while studying the issuance of central bank digital currency (CBDC), the digital Lira.

As per the central bank, it has already completed the Proof-of-Concept stage for the CBDC. To accomplish this, the Central Bank of the Republic of Turkey (CBRT) has joined hands with several local tech firms like Havelsan and Aselsan. Besides, it is also working with TUBITAK science and technology center.

Collaborating with local tech partners

As said, the central bank of Turkey has already collaborated with three big local tech firms. These domestic partners and the central bank have, together, formed the “Digital Turkish Lira Collaboration Platform”.

In the coming months, several tech developers are likely to join this platform. Besides, the central bank is willing to invite a wide range of expertise to work on this. Of course, the Digital Lira will work on a blockchain-powered platform. This will further boost the acceptance of distributed ledgers in Turkey’s national payments system.

The Turkish central bank will continue the trials for the Digital Lira till 2022. This will help them to assess whether if the technology is robust enough for implementation nationwide. It will also help the central bank is developing its own CBDC solutions.

A large number of central banks worldwide have been working on the CBDC project. China’s PBoC has been leading the development with phased trials of the Digital Yuan.

The U.S. Federal Reserve will soon release a discussion paper on the Digital Dollar. Furthermore, the European Central Bank (ECB) has fast-tracked CBDC developments. ECB President Christine Lagarde also lashed out at cryptocurrencies recently. In her recent podcast interview with Bloomberg, Lagarde said:

I think we have to distinguish between cryptos that are those highly speculative, suspicious occasionally, and high intensity in terms of energy consumption assets, but they’re not a currency.

About Author

Bhushan is a FinTech enthusiast and holds a good flair for understanding financial markets. His interest in economics and finance draw his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In his free time, he reads thriller fictions novels and sometimes explores his culinary skills.

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