Bitcoin prices dropped on Friday after Turkey’s central bank unveiled plans to ban the use of cryptocurrencies and other digital assets to pay for goods and services from April 30.
The country’s central bank said overnight that crypto and other assets using distributed ledger technology, similar to blockchain, are not allowed to be used for payments, saying they entailed “significant risks” including a lack of regulation, volatile market values and possible use in illegal activity.
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“Recently, some initiatives have emerged regarding the use of these assets in payments. It is considered that their use in payments may cause non-recoverable losses for the parties to the transactions due to the above-listed factors and they include elements that may undermine the confidence in methods and instruments used currently in payments”, the bank said in a statement.
Cryptocurrency use has been on the rise in Turkey as investors look to cash in on the ongoing market bull run while also looking to offset the declining value of the Turkish lira on global currency markets.
Crypto is also being used as a hedge against inflation in the country, which rose to over 16% on an annual basis last month.
The price of Bitcoin was down 3.4% at US$60,298 in late-morning trading in London.