Turkey has been pressed by the Financial Stability Board to build out dedicated rules for stablecoin issuers, with the G20 watchdog flagging the absence of any such framework as a core threat to financial stability.
In a peer review published Wednesday of how Turkey applies international standards to crypto assets, the FSB credited Ankara with "meaningful progress," noting that much of the market now sits under regulatory oversight. Crypto asset service providers must register and obtain licenses, client holdings are subject to strict custody segregation, and authorities have set up a centralized data platform to track activity.
The board nonetheless said the country's regime does not yet fully match its global recommendations, and it singled out stablecoins, which are typically dollar-pegged, as the most conspicuous hole. "There remains no framework in place for the regulation of stablecoin issuers," the FSB said, calling this "a core financial-stability concern" in light of strong foreign-exchange-linked channels and the potential for "digital dollarisation."
Crypto and stablecoins have taken on outsized importance in Turkey, where households have spent years contending with steep lira depreciation and high inflation. The review put transactions in the sector at close to $200 billion last year, driven largely by retail investors.
The FSB also wants Turkey to stand up a formal framework for monitoring financial-stability risks, gather and centralize more market data, sharpen supervision and enforcement, and deepen cross-border cooperation with overseas regulators. "The borderless character of these markets means that no jurisdiction can address the associated risks through domestic action alone," it said.
The review acknowledges that Turkey has already erected guardrails to keep crypto from bleeding into the wider financial system, including a ban on using digital assets for domestic payments. The FSB's list of recommendations adds to the workload for Turkish officials, who are already moving to tighten rules following a $20 billion investment fund scandal that left millions of savers out of pocket.
The assessment is part of the FSB's broader push to gauge how member jurisdictions are implementing its global regulatory framework for crypto activities. Turkey's combination of high retail participation, currency pressure and a dollar-linked stablecoin market makes it a closely watched test case for whether national rules can contain risks that cross borders.
For crypto firms operating in Turkey, the message is that licensing and custody standards may hold, but stablecoin issuance faces a new compliance layer. For policymakers elsewhere, the review underscores a widening gap between rules for trading platforms and rules for the dollar-token infrastructure that increasingly underpins them.
