When we talk about “Investing in Crypto & Web3 Startups Under the Shadow of Regulation”, we are really asking one core question: how can foreign investors back Turkish crypto and Web3 ventures without being blindsided by regulation? Turkey is a large, crypto-savvy market with millions of retail users, but it is also moving rapidly towards a much more regulated environment for crypto assets and service providers.
1. The new legal landscape: crypto law and supervisors
Turkey has now adopted a comprehensive legal framework for crypto assets by amending the Capital Markets Law No. 6362 with Law No. 7518, often referred to as the “Crypto Law”, which entered into force on 2 July 2024. This law explicitly recognises crypto assets as a category within capital markets legislation and gives the Capital Markets Board (CMB) broad powers to license and supervise crypto-asset service providers (CASPs) and crypto trading platforms.
At the same time, the Financial Crimes Investigation Board (MASAK) treats CASPs as “obliged entities” for anti-money-laundering (AML) and counter-terrorism-financing (CTF) purposes. CASPs must implement robust compliance programmes, customer due diligence and “travel rule” style monitoring of transfers.
One important limitation remains: since an April 2021 Central Bank regulation, crypto assets cannot be used as a means of payment for goods and services in Turkey, although trading, holding and exchanging crypto remain legal.
2. Who needs a licence? CASPs and Web3 structures
For investors, the first key question is whether the target qualifies as a “crypto asset service provider” under Turkish law. The Crypto Law and related CMB guidance cover platforms that mediate crypto trading, custody providers and other intermediaries designated by secondary legislation. These entities must obtain a CMB licence and meet capital, governance and IT security standards.
Crucially for foreigners, non-Turkish CASPs targeting residents in Turkey are not free to operate from abroad without oversight. Guidance around the new framework makes clear that foreign service providers must either become licensed or cease activities directed at Turkish residents, and even crypto ATMs in Turkey are being phased out. (Moroğlu Arseven)
For Web3 ventures that see themselves as “pure tech” – for example, a DeFi interface, NFT marketplace or infrastructure project – the risk is regulatory re-characterisation. Even if the founders say, “we are not an exchange,” the CMB has authority to look at the substance of activities: if the platform effectively intermediates the trading, custody or issuance of crypto assets, it may be treated as a CASP and pulled into the licensing net.
3. Investor exposure: equity, tokens and regulatory risk
From an investor’s standpoint, exposure in Turkish crypto and Web3 projects usually comes in three forms:
- Equity or convertible instruments in a Turkish company (often a technology or platform company);
- Token allocations (utility, governance or asset-backed tokens); and
- Sometimes, contractual revenue-sharing or IP licences.
The Crypto Law allows the CMB to authorise capital markets instruments issued as crypto assets, meaning that certain tokens may be treated in practice like securities under Turkish law, with prospectus and offering rules.
For a VC or strategic investor, this raises issues such as:
- Whether token offerings to Turkish residents require CMB approval or must be excluded from the Turkish market;
- Whether the token design could be viewed as a collective investment-type product;
- How lock-ups, vesting and transfer restrictions will be enforced if the token is traded on regulated platforms.
Regulatory mis-categorisation can lead to administrative fines, enforcement measures and even suspension of activities, which ultimately hit investor value.
4. Protection of client assets and insolvency scenarios
One of the more investor-friendly features of the new regime is the segregation of client assets at CASPs. The draft and enacted texts emphasise that customer cash and crypto assets must be kept separate from the service provider’s own assets, and cannot be seized or pledged for the CASP’s debts.
This segregation is designed primarily to protect retail platform users, but it also indirectly matters for institutional investors who hold assets through Turkish exchanges or custody providers. If a licensed CASP faces financial difficulty, the expectation is that customers’ crypto and fiat balances will be ring-fenced from the CASP’s insolvency estate, subject to how courts and administrators apply the new rules in practice.
However, equity investors in the CASP or Web3 company remain exposed to the standard principles of Turkish insolvency and concordato law: shareholders sit behind creditors, and contractual liquidation preferences between shareholders cannot override mandatory creditor ranking.
5. AML/CTF pressure and enforcement trend
Turkey has been under close FATF scrutiny in recent years and is keen to demonstrate strong enforcement against money laundering and terrorism financing, including in virtual assets. MASAK’s 2021 and subsequent measures brought CASPs firmly within the AML/CTF perimeter; more recent reforms require crypto asset service providers to adopt comprehensive compliance programmes and integrate with MASAK’s e-notification systems.
Enforcement risk therefore runs not only through the CMB but also through MASAK investigations, on-site inspections and potential sanctions for compliance failures. This broader regulatory tightening – including crackdowns on market manipulation and payment firms – forms part of the same policy trajectory that investors should factor into their risk assessment.
6. Practical checklist for foreign investors
Before writing a cheque into Crypto & Web3 Girişimlerinde Regülasyon Gölgesinde Yatırım in Turkey, foreign investors should at minimum:
- Confirm whether the target is, or will become, a licensed CASP and review all CMB correspondence;
- Analyse MASAK compliance, including KYC/AML policies, Travel Rule implementation and sanctions screening;
- Map the token structure: which tokens may fall within CMB jurisdiction, and which markets (including Turkish residents) are targeted or excluded;
- Review contractual and technical arrangements for client asset segregation and custody;
- Stress-test downside scenarios: regulatory enforcement, licence suspension, insolvency and IP transfer.
Done correctly, the regulatory “shadow” over crypto and Web3 in Turkey does not have to be a deal-killer. It simply means that foreign investors must build regulatory analysis into their investment thesis from day one, with local legal advice and realistic expectations about compliance costs and supervision intensity.
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