Communiqué on Operating Procedures and Principles and Capital Adequacy of Crypto Asset Service Providers

The Communiqué on Operating Procedures and Principles and Capital Adequacy of Crypto Asset Service Providers (the “Communiqué”), published in the Official Gazette dated March 13, 2025, and numbered 32840, regulates the services and activities that may be offered by crypto asset service providers (the “CASPs”), the applicable regulatory principles, and the capital adequacy requirements.

Below, you may find a summary outlining the key obligations that CASPs must comply with under the Communiqué.

A. Trading Rules

CASPs may execute client orders either within trading environments they establish themselves or, alternatively, fulfill such orders directly from their own portfolios outside of the trading environment.

Within the trading environment, orders should be matched at different price levels or completed through domestic or foreign entities that offer both buy and sell prices. The involvement of foreign entities in the trading environment does not absolve the platform from its legal responsibilities. Prior to granting such entities access, CASPs are required to collect complete customer information in compliance with anti-money laundering and counter-terrorism financing regulations. Additionally, an agreement must be executed between the platform and the foreign entity and the scope of services to be provided must be clearly disclosed on the platform’s website. CASPs may submit orders to their own trading environment subject to the proper identification and management of any conflicts of interest. Furthermore, they may establish different markets based on the characteristics of crypto assets and define distinct rules for each market.

In cases where client orders are fulfilled directly from the CASP’s own portfolio, the platform must inform investors that such practice may result in a financial gain for the platform at the client’s expense.

Except for liquidity provision and market making activities, CASPs may only sell crypto assets up to the amount actually held in their own wallets. These provisions aim to enhance transparency, protect investors, and ensure the fair operation of CASPs.

B. Client Orders and Execution Principles

CASPs must execute client orders by considering factors such as price, cost, speed, and custody, in a manner that ensures the best possible outcome for the client. In this context, CASPs are required to establish and implement order execution policies that ensure transactions are conducted reliably, transparently, fairly, and in a stable manner. These policies, which must be approved by the board of directors, should include detailed provisions on order types, order cancellations, price ticks, and rules related to market makers. CASPs must review these policies at least annually and notify clients of any changes no later than 15 days prior to their implementation. All orders must be recorded in the system, assigned an order number, and processed in accordance with price-time priority rules. Additionally, in extraordinary circumstances or in the event of technical failures, pending orders may be cancelled or suspended in accordance with predefined procedures.

Furthermore, CASPs are obligated to inform clients in writing or electronically under certain special circumstances, including technical issues preventing client transactions, significant changes in the distributed ledger network, and updates regarding the compensation of crypto asset losses resulting from the platform. As the burden of proof for such notifications lies with the platform, it is crucial to obtain confirmation from the client that the notification has been received.

C. Other Services to be Provided by CASPs

Aside from trading and custody services, CASPs may offer investment advisory services to investors, but only on a limited basis. However, such services may only be provided to clients who hold crypto assets with a current value of at least TRY 50 million within the platform. To offer this service, CASPs are required to employ qualified investment advisors and establish a dedicated research unit. Furthermore, CASPs are strictly prohibited from managing client portfolios either directly or indirectly.

In addition, CASPs may act as intermediaries for the initial offering or distribution of crypto assets. In such cases, the content and accuracy of the relevant smart contracts must be carefully verified, and the crypto asset must comply with applicable regulations and listing criteria. For crypto assets that qualify as capital market instruments, compliance with the Capital Markets Board’s (the "Board") regulations is mandatory. In both services, CASPs are responsible for ensuring that contractual terms are appropriate and that investor protection is maintained. These activities involve direct interaction with investors and require a high level of control and transparency, imposing specific obligations on the CASPs.

D. Price Monitoring System

Under the Communiqué, CASPs are required to establish a dedicated unit responsible for operating a price monitoring system and to appoint at least one risk management professional within this unit. This unit must identify and report any transactions that cannot be reasonably explained or that could undermine market confidence and stability, and submit such reports to the general manager. The general manager is obligated to take action against the accounts responsible for these transactions, including restrictions or suspension, and must promptly notify the Board. The operational procedures of the price monitoring system, including the tools and methods to be used and the measures to be taken, must be set out in a written policy. These requirements, however, do not apply to crypto assets whose prices are primarily determined abroad and that are widely traded on foreign markets.

In addition, crypto assets listed on CASPs cannot be subject to leveraged transactions, derivative agreements, margin trading, short selling, or securities lending. All such activities are strictly prohibited.

E. Listing of Crypto Assets

CASPs must establish a listing committee with at least three members experienced in relevant fields to assess the eligibility of crypto assets. Assets must meet legal and technical criteria, such as cold wallet compatibility, transparency of transfers, and lawful use. CASPs cannot list assets issued by their affiliates or related parties. Listing procedures and current listings must be published on the platform’s website, along with six months of historical data. If an asset no longer meets listing criteria, it may be delisted with at least seven days’ prior notice to customers.

F. Conditions for the Custody of Crypto Assets

Under the Communiqué, if customers choose not to store their crypto assets in their own wallets, custody services may be provided by banks approved by the Banking Regulation and Supervision Agency or by other institutions authorized by the Board. Custodian institutions must hold customer assets separately from their own, on behalf of the platform, in aggregated form. Hot wallets used for custody should not exceed 5% of total customer assets, though this may be increased to 10% depending on transfer volume. All cryptographic keys must be stored in secure hardware modules in line with The Scientific and Technological Research Council of Turkey (TÜBİTAK) Infrastructure Criteria.

G. Conditions for Integration with the Central Securities Depository (the “CSD”)

CASPs are required to track customers’ crypto asset balance information in an integrated manner with the CSD and to carry out the reporting obligations requested by the CSD. The procedures for such reporting will be governed by a directive issued by the CSD and approved by the Board. Based on the data provided by CASPs, the CSD generates central ledger reports which are made available to customers through the E-Investor portal for balance inquiries. If any discrepancies arise between the reports submitted, CSD must immediately notify the Board.

In addition, CASPs must reconcile customer transactions for each crypto asset within the institutional registry system and generate a daily reconciliation report. If, based on this report, a transfer of customer assets from platform wallets to custodian wallets is required, the transfer must be executed daily at 11.59 PM. However, if deemed necessary or upon customer request, transfers may also be carried out during the day without waiting for the end of day deadline.

H. Conditions for Capital Requirement

Trading platforms must be established with a minimum capital of TRY 150 million, while custodian institutions are required to have a minimum capital of TRY 500 million. These institutions' shareholders’ equity may not fall below the minimum capital thresholds. Additionally, platforms must maintain at least 25% of their equity as paid-in capital, and their equity must not fall below the required liquid reserve levels. At least 95% of the crypto assets that customers choose not to hold in their own wallets must be held by authorized custodian institutions, with a maximum of 5% allowed to be held in the platform’s wallets. During daily operations, this 5% limit may temporarily increase to 10%, but any excess must be immediately transferred to a custodian.

CASPs are also required to calculate position risk and foreign exchange risk, considering potential losses in the value of their own portfolio assets and fluctuations in exchange rates. In the event of non-compliance with these obligations, platforms are granted a period of 30 business days to rectify the issue, during which a letter of guarantee may be required under certain conditions. If necessary, this period may be extended. These regulations are designed to ensure the security of customer assets and maintain the stability of the financial system.

I. Transitional Provisions

The CASPs listed in the “List of Operating Entities” must align their custody infrastructure with the applicable regulations by June 30, 2025. These entities are required to meet the capital and equity obligations as of the date they apply to the Authority for an operating license, while compliance with all other obligations

must be ensured no later than June 30, 2025.