Turkish crypto exchange Vebitcoin announced the termination of operations. It is the second Turkish crypto trading platform to crash after the country's Central Bank banned the use of cryptocurrency as a payment method in early April.
Turkey is tightening its regulation of cryptocurrencies. On April 16, the central bank of Turkey announced a ban on the use of cryptocurrencies as a payment instrument. The regulator explained its decision with fears that many cryptocurrencies are used for criminal purposes, while national regulators are not able to regulate this financial market. Turkish payment service providers are now not allowed to directly or indirectly incorporate cryptoassets into their business models. The ban resulted in the closure of several trading floors.
On April 18, the Thodex crypto exchange announced its closure. At the same time, local police arrested 68 people and their ties to Thodex, which is accused of fraud. According to rumors, the general director of the exchange, Farouk Fatih Ozer, fled to Albania a few days after the closure of the trading platform with $2 billion dollars belonging to users of the crypto exchange. The company's bank accounts were blocked due to an investigation.
On April 23, the closure was announced by Vebitcoin. “We have to state with regret that this situation has led us to a very difficult financial situation,” the company said in a statement. “We decided to stop our activities in order to fulfill all requirements and obligations.”
The ban on cryptocurrencies, announced by the Turkish central bank on April 16, will take effect on April 30. Local officials argue that it is not an outright ban on cryptocurrencies. Thus, the Chairman of the Central Bank of Turkey Shahap Kavachioglu noted that in the future it is planned to clarify at the legislative level the definition of cryptocurrency and the requirements for storing digital assets, which organizations working with cryptocurrencies will have to comply with.