1. Legal Status of Cryptocurrency Exchanges in Turkey

In Turkey, the legal framework for cryptocurrency exchanges is still under development, but some basic rules have been established:

a. Legal Status

Cryptocurrency exchanges do not operate as licensed financial institutions like traditional banks.

MASAK Regulations:

A regulation published in 2021 included cryptocurrency exchanges under the Law on the Prevention of Laundering Proceeds of Crime.

Exchanges are required to verify customer identities (KYC - Know Your Customer) and report suspicious transactions.

b. Obligations

Customer Identity Verification (KYC): Exchanges are required to collect users’ identity information.

Suspicious Transaction Reporting: Non-compliance with MASAK’s anti-money laundering (AML) policies can result in severe penalties.

Tax Compliance: Although there is no specific regulation yet, cryptocurrency gains may need to be reported for income tax purposes.

c. Supervision

Exchanges are regularly audited by MASAK. In 2021, significant fines were imposed on some local exchanges.

There are no specific regulations to protect users in cases of bankruptcy or fraud (e.g., the Thodex case).

2. Global Legal Status and Licensing Processes of Cryptocurrency Exchanges

Globally, cryptocurrency exchanges are regulated under three main approaches:

a. Countries Permitting and Regulating Exchanges

1. United States

Regulatory Authorities: SEC (Securities and Exchange Commission), CFTC (Commodity Futures Trading Commission), and FinCEN (Financial Crimes Enforcement Network).

Licensing Requirements:

Exchanges must register as money service providers.

Cryptocurrencies classified as securities fall under SEC regulations.

Audits: Strict compliance with AML policies is mandatory.

2. European Union

MiCA (Markets in Crypto-Assets Regulation): Set to take effect in 2024, providing a unified framework for licensing and supervising cryptocurrency exchanges.

Exchanges must operate transparently and protect users.

3. Japan

The Financial Services Agency (FSA) regulates and licenses exchanges.

Exchanges must separate customer funds and provide insurance.

4. Singapore

The Monetary Authority of Singapore (MAS) requires exchanges to obtain licenses as digital payment token service providers.

b. Countries with Partial Regulations

1. India: Exchanges are operational, but heavy taxes and regulatory uncertainties exist.

2. Canada: Exchanges must comply with securities regulations, but rules vary by province.

c. Countries Prohibiting Exchanges

1. China:

Cryptocurrency exchanges are completely banned, replaced by the government’s Central Bank Digital Currency (CBDC).

2. Russia:

While awaiting comprehensive regulation, certain trading activities are restricted.

3. Licensing Processes of Cryptocurrency Exchanges

Licensing processes for cryptocurrency exchanges generally involve the following steps:

a. Application Requirements

KYC and AML Policies: Exchanges must define procedures for verifying customer identities.

Financial Reporting: Exchanges must prove that customer funds are held separately and transparently.

Cybersecurity Measures: Platforms must demonstrate adequate security to protect user funds.

b. Audit and Compliance

Regulatory authorities regularly audit exchanges and assess customer complaints.

Non-compliance can result in heavy fines or license revocation.

c. Insurance and Backup

In some countries, exchanges are required to insure customer funds.

4. Conclusion

The legal status and licensing processes of cryptocurrency exchanges depend on the economic, technological, and legal infrastructures of countries. While Turkey needs more comprehensive regulations, countries like the US, EU, and Japan have developed strict licensing and supervision mechanisms that protect investors.

The reliability and transparency of cryptocurrency exchanges are crucial for both investors and regulatory authorities.