Turkey’s financial regulator has unleashed one of its most sweeping crackdowns yet on the cryptocurrency sector. Turkey’s Capital Markets Board (CMB) has reportedly blocked access to 46 crypto websites, including the second-largest global decentralized exchange, PancakeSwap.
The Capital Markets Board (CMB), Turkey’s main financial watchdog, said in an official announcement that the platforms were offering “unlicensed crypto asset services” to Turkish residents—an action deemed a violation of the country’s Capital Markets Law.
The list of banned entities includes a mix of crypto exchanges, trading apps, and even information-based platforms like Cryptoradar, a popular cryptocurrency price comparison site. PancakeSwap alone saw over $325.2 billion in trading volume in June, making it a major player in the decentralized finance (DeFi) ecosystem alongside Uniswap and Curve. Turkish regulators now consider the platform’s operations illegal despite its global status.
The CMB did not reveal the individuals who violated the regulations. It’s also not said whether the targeted platforms had received prior warning or an opportunity to comply with local laws before the shutdown. PancakeSwap had not made a public statement at the time of this writing.
This marks a radical change in Turkey’s approach to crypto services and suggests a move toward centralized control in an industry meant to be borderless and decentralized.
Turkey tightens crypto oversight
The move against crypto sites is part of a broader push by Turkish regulators to establish order and legal clarity in a market that has expanded rapidly but in a largely unregulated fashion.
Turkey introduced new regulations aimed at curbing crimes like money laundering and terrorism financing. Under these rules, crypto platforms are required to identify and verify their users, particularly when transactions involve funds from newly unregistered wallet addresses.
On the other hand, users are expected to give a transaction description of at least 20 characters for each transfer.
Apart from transaction descriptions, platforms are now expected to impose holding periods on crypto withdrawals when the Travel Rule is not applicable. This includes a 48-hour delay for most withdrawals and a 72-hour delay for the first withdrawal from any newly created account.
If a transaction appears suspicious or lacks proper documentation, service providers can flag it as high-risk. They may then refuse or halt the transfer or impose restrictions such as bans, limits, or account freezes on the user involved.
Transactions below 15,000 lira do not have to undergo identity checks. Still, regulators have warned that those trying to split larger transfers into smaller transactions to fly under the radar may also be flagged.
Turkey aligns with global crypto crackdown efforts
Turkey is now the latest country to join a growing list of countries closing in on the crypto industry. Russia, Kazakhstan, Venezuela, and the Philippines have all moved to restrict access to platforms that do not have local authorization and are not meeting regulatory standards.
Critics say Turkey’s move should also be interpreted as part of its broader attempts to stabilize the ailing national economy and shield ordinary citizens from scams, fraud, and highly volatile financial products. Cryptocurrency adoption in Turkey has surged recently, driven by the country’s high inflation and weakening lira. To others, crypto has become an alternative store of value and carries huge risks.
In 2021, it prohibited using digital assets for payments, arguing that they created a risk to financial stability. The decision mobilized public anger and prompted legal challenges, but the ban took effect. A domestic law firm started preparing to challenge the ban in court earlier this year, indicating that the legal infrastructure for crypto in Turkey remains a work in progress.
This week’s enforcement action seemed to attempt to establish a position of regulatory primacy before that legal uncertainty expands.
It is unclear whether the blocked platforms can reapply or appeal their banning via a local license. In the meantime, blocked platforms remain out of reach of Turkish users unless they are accessed through VPNs or other methods, putting them at legal risk.
