The cryptocurrency law and ico regulation approved and published in Turkey in June 2024 does not only affect crypto asset service providers such as exchanges and other platforms. It also establishes new rules for ICOs and coin/token issuances from scratch. While the law and its secondary regulations primarily impact exchanges and platform operators, anyone involved in coin issuance, purchasing, or any aspect of the ICO ecosystem must also comply with these newly introduced rules. Let’s take a closer look at the key regulations in Turkey.
Regulatory Landscape for Coin and Token Issuance in Turkey
Until now, there was no explicit prohibition on coin and token issuance in Turkey. The only regulatory interventions came in the form of warnings from the Capital Markets Board (SPK) and the Banking Regulation and Supervision Agency (BDDK) to protect investors. Fraudulent token issuances, which occasionally surfaced, were handled by judicial authorities rather than being subject to specific crypto regulations. Now that we have established that previous regulations were minimal, let’s clarify who is affected by the new legal framework.
Globally, and in Turkey as well, the issuance of coins or tokens that do not qualify as electronic money or securities does not require licensing from the SPK. However, new regulations impose specific conditions, and as long as these conditions are met, the tokens can be listed on licensed crypto asset service providers in Turkey. The regulatory body sets the general framework and rules, delegating listing responsibilities to crypto exchanges. These exchanges establish their own listing criteria and committees to decide which coins can be traded on their platforms. Before discussing the main rule, let’s highlight two exceptions where these regulations do not apply.
Exceptions to the ICO Regulation
- NFTs and Gaming Ecosystem Tokens: Tokens specifically used within gaming ecosystems (limited to the buying and selling of virtual assets in-game) are still not subject to any regulation. However, if additional functionalities are assigned to these NFTs or in-game tokens, they will no longer qualify for this exemption.
- Securities and Stablecoins: If a coin is classified as a security, it cannot be directly issued and listed. In such cases, SPK’s broader securities regulations will apply. Similarly, stablecoins will be regulated under electronic money and Central Bank of Turkey (TCMB) regulations. These are just examples, and other cases may be governed by separate regulatory frameworks.
Key Compliance Requirements for ICOs and Token Listings
If a startup decides to launch an ICO and list its token on a Turkish exchange, it must comply with the following requirements:
- The issued token must be compatible with infrastructure that allows for custody by SPK-authorized custodians.
- The project owner/company must not be granted extraordinary rights through the whitepaper or any other means.
- The token must not allow concealed transactions and must be capable of being stored in cold wallets.
Additionally, there must be no direct or indirect relationship between the token issuer and the exchange listing the token. This means that a cryptocurrency exchange can no longer issue its own token. Moreover, existing exchange-issued tokens must be delisted within three months.
In general, project owners seeking to list their tokens must apply to an authorized exchange, where the exchange’s listing committee will review the application and make a decision. Even afte