In brief Turkey is reportedly drafting legislation to grant its financial intelligence unit Masak expanded powers to freeze bank and crypto accounts linked to suspected criminal activity. The bill would allegedly allow the watchdog to shut down accounts, limit transactions, and blacklist crypto wallet addresses across banks, payment firms, and exchanges. Experts warned the measures could increase compliance costs for crypto platforms and drive users toward decentralized alternatives, though institutional adoption may grow if implemented transparently.
### New Legislative Measures for Financial Oversight
Turkish lawmakers are said to be preparing legislation that would enhance the authority of the country’s financial crimes unit, Masak, enabling it to freeze bank and cryptocurrency accounts that are suspected of being involved in illegal activities. According to reports from Bloomberg, the draft bill will provide Masak with the power to take decisive action against accounts flagged for criminal use across various financial institutions and crypto services.
### Expanded Powers for Masak
The proposed legislation would allow Masak to shut down accounts at both banks and cryptocurrency exchanges, impose limits on transaction amounts, and freeze access to mobile banking services. Additionally, it would enable the agency to blacklist specific crypto wallet addresses when criminal activity is suspected, as noted by Bloomberg.
### Focus on Rented Accounts
This draft legislation, anticipated to be part of the 11th Judicial Package when parliament reconvenes, primarily aims to tackle the issue of “rented accounts,” wherein individuals provide their banking credentials to criminals engaged in illegal betting and fraud activities. This initiative follows Turkey’s removal from the Financial Action Task Force’s “grey list” in June 2024, a significant development that Finance Minister Mehmet Simsek celebrated on social media, highlighting the country’s commitment to improving oversight and regulatory standards.
### Industry Reactions to Proposed Regulations
Hüseyin Gökay Aktaşın, the head of market-making at Turkey’s crypto exchange CoinTR, expressed to Decrypt that the intention behind these measures appears to be the prevention of financial crimes, particularly those linked to fraudulent gambling activities. He emphasized that as a regulated exchange, CoinTR adheres to stringent guidelines set by MASAK and the Capital Markets Board (SPK), prioritizing transparency and anti-money laundering (AML) compliance.
### Concerns Over Increased Surveillance
Nic Puckrin, a crypto analyst and co-founder of The Coin Bureau, voiced concerns about the implications of this proposed legislation, viewing it as a step towards an overreaching state presence in financial affairs, masked as compliance. He remarked that such powers over bank accounts raise significant ethical questions and fundamentally contradict the core principles of cryptocurrency, which emphasize self-custody and resistance to censorship. Puckrin warned that this could reflect poorly on Turkey’s ambitions to be a leading player in the global cryptocurrency landscape.
### Uncertainty and Its Implications for Users
The proposed regulations are still open to revisions during the legislative process and may undergo changes before they receive final approval. Lionel Iruk, a senior advisor at Nav Markets and managing partner at Empire Legal, indicated that the ambiguity surrounding the criteria for account freezes and the absence of clear legal guidelines might push users towards decentralized or offshore platforms. Conversely, he noted that institutional interest could increase if the framework is established in a transparent and reliable manner.
