By Alicia Maher
The Turkish government is planning to launch its Central Bank Digital Currency (CBDC) as soon as 2023. The President’s Strategic and Budget Office presented the Presidential Plan for 2023. The CBDC was reportedly discussed in the plan.
Presidential Direction for the CBDC
Reports have circulated in Turkish media about the central bank’s next big move for the coming year. The CBDC agenda is said to be well-detailed in the Presidential Annual Plan for the coming year. It is also said to be covered under the Policies and Measures subheading.
The Plan is said to state that the CBDC built on a blockchain will be implemented in 2023. And the Turkish Central Bank will be responsible for the implementation along with other agencies. The agencies include the country’s Finance Ministry and some science and tech research institutes.
The latest announcement has come after the central bank first stated last year September that it was planning a CBDC project. The apex bank said the CBDC would complement its running payment systems across the country. The project is called the Central Bank Digital Turkish Lira Research and Development.
The official documentation states that the Digital Turkish Lira is going to be integrated along with digital identities. It is also going to be integrated with FAST.
Turkey Turned to Crypto
The payment system run by the Turkish central bank is FAST. The presidential plan also states that the central bank should conduct research and development exercises. This is to be done along with the CBDC testing in conjunction with other national banks.
The CBDC launch might give signals that the government of Turkey is reconsidering its position on digital assets. Note that the Turkish central bank banned all cryptocurrency activities last year in April. The central bank also said via a statement that it will ban buying and services offerings that involve cryptocurrency payments.
Although the regulation left grey areas that could be interpreted in any way. The first is that crypto deposits could still be made. Furthermore, crypto activities could still be carried out on exchanges since they are not paid for any goods or services.
Despite the active ban on crypto, Turkey has witnessed a huge increase in crypto trading. Records show there are usually more than one million transactions a day. The increased crypto trading followed the Lira’s drop to unprecedented low levels.
Turks consequently ran to crypto as a way of preserving their declining savings. It appeared to be the best store of value for them.