Bitcoin (BTC) Drops 3% as Turkey Bans Cryptocurrency Payments Citing Lack of Regulatory Supervision

April 16, 2021 6:19 AM EDT

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Bitcoin (BTC) price is trading about 3% lower today to push the world’s largest cryptocurrency towards the $60,000 mark. Two days ago, BTC price printed a new record high near the $65,000 handle on the back of the blockbuster Coinbase (NASDAQ: COIN) listing.

Bitcoin price has slipped on news that Turkey’s central bank moved to ban crypto payments, citing “irreparable” damage and high transaction risks. Following their announcement, the purchase of good and services using digital assets won’t be possible anymore.

It is possible that today’s move is a result of investors’ higher appeal for BTC recently given some experts see it as a hedge against inflation. Turkey reported inflation figures of 16.2% for March, which is over 200% higher than the bank’s target of 5%.

"Payment service providers will not be able to develop business models in a way that crypto assets are used directly or indirectly in the provision of payment services and electronic money issuance," and will not provide any services, the central bank said.

There are high transaction risks as crypto assets are "neither subject to any regulation and supervision mechanisms nor a central regulatory authority."

"Their use in payments may cause non-recoverable losses for the parties to the transactions ... and include elements that may undermine the confidence in methods and instruments used currently in payments," the central bank added.

This move comes after authorities requested information from crypto trading platforms.

At 0620 EST, Bitcoin trades at $60,900, or 2.7% lower on the day.

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