A. Introduction

The Capital Markets Board of Turkey (“CMB”) has determined the principles and criteria regarding the conditions that crypto asset service providers (“Platform”) should meet with the Resolution dated August 8, 2024 and numbered 42/1259 (“Resolution”).

With the amendments made to the Capital Markets Law No. 6362^[1] (“CML”), which entered into force after being published in the Official Gazette dated July 2, 2024 and numbered 32590, the CMB was given the authority to determine the principles and principles regarding the Platforms, their partners, managers and capital, and with the Press Release dated July 2, 2024, the CMB collected the applications of the currently operating Platforms regarding their intention to operate or liquidate until August 2, 2024.

With its Resolution, the CMB stated that, with the information and documents obtained from the Platforms operating in Turkey as of July 2, 2024, a sector profile was prepared on basic issues such as capital structures, organisational structures, information processing and wallet technologies, number of customers and custody balances of the companies. Taking into consideration the sector profile, the CMB published the conditions to be met by the founders, shareholders and managers of the Platforms that will be established or intend to continue their activities.

B. Conditions for the establishment of Platforms

Pursuant to the Resolution, in order for the CMB to authorise the establishment of Platforms;

• To be established as a joint stock company,
• All of its shares shall be registered shares and issued against cash,
• The Company’s capital must be at least TRY 50,000,000 and paid in cash and the shareholders’ equity must not be less than this amount,
• Including the phrase “crypto asset trading platform” in their trade names to indicate the services they will offer,
• The articles of association stipulate that the subject of business is exclusively crypto-asset trading, initial sale or distribution, clearing, transfer and one or more of the custody transactions required by these transactions,
• Minimum 3 members of the board of directors,
• Transparency and clarity in the partnership structure

are required.

C. Conditions regarding the founders, partners and managers of platforms

Pursuant to the Resolution;

• The founders and shareholders of the Platforms and the real persons who have management control over the Platform must meet the conditions specified in paragraph 3 of Article 35/B of the CML (e.g. not to be a bankrupt, not to have declared concordat, not to have been granted a postponement of bankruptcy, and not to have been sentenced to imprisonment or not to have a finalised conviction for the offences specified in the relevant article),
• The majority of the members of the board of directors must be graduates of 4-year undergraduate programs.

Platforms wishing to start operating as a crypto asset service provider will apply to the CMB for establishment with the documents showing that they meet the conditions summarised above and the documents in Annex-1 and Annex-2. However, the establishment permit does not mean an operation permit and a separate application will be required for the operation permit.

D. Platforms Already in Operation

Platforms included in the “List of Operating Platforms” published by the CMB or those whose applications under evaluation and operating as crypto asset service providers in Türkiye as of July 2, 2024 are required to apply to the CMB until November 8, 2024 by meeting the conditions set forth by the Principle Decision.

However, the CMB stated in its press release dated July 2, 2024 that not all of the applications made within the scope of the press release dated July 2, 2024 have been examined yet, and in this context, the List of Operating Platforms will be updated.

Within the scope of the ongoing examinations, the CMB clarified that the applications of the applicants who do not have any customers or custody balances belonging to customers are not taken into consideration, and that the applications with deficiencies in the Annex-2 form, information regarding the Platform’s custody infrastructure or the information and documents regarding the technical infrastructure of the Platform in Annex-1 will be removed from the process, and the deficiencies other than these will be notified to the Platforms and requested to be completed within 15 business days.

[1] Offical Gazette dated December 30, 2012 and numbered 28513