Turkey’s Cryptocurrency Pain Extends With Second Exchange Collapse

   2021-04-25 09:04

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  • Vebitcoin, Thodex, crypto exchange ceases operations
  • Chief of Vebitcoin detained, Thodex founder flees the country
  • Accounts sealed halting withdrawals; losses estimated $2 billion

Turkey’s war against cryptocurrency continues, and the chief executive of the second biggest was reportedly detained. The exchange collapsed after cryptocurrencies ended the week on a sad note. According to Bloomberg, Vebitcoin has ceased its operation, citing financial woes. The Demiroren News Agency reported that the Chief Executive of Vebitcoin Ilker Bas and three other employees had been detained. The Financial Crimes Investigation Board has blocked Vebitcoin’s accounts, and a probe is pending.

Bitcoin value tanks by 19%

CoinGecko.com tracks data on prices, volume and market share of all the cryptocurrencies in Turkey. It reported that Vebitcoin Turkey’s fourth-biggest exchange did close to $60 million in daily volumes. Bitcoin comprised about 50% of these transactions. As a result of a ban and detention of the exchange managers, Bitcoin value tanked by more than 19% this week.

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Bitcoins fall in value could be just the beginning of a rout which most expert had predicted way back in February when prices had tumbled amid a broader slump in risk assets. Other cryptocurrencies like Ether and DogeCoin saw a slight rise buoyed by Bitcoin’s woes dropped by Friday, hinting that the malaise is much more profound.

Foregone conclusion, crackdown feared

The rumbling of a crackdown was evident much earlier. Thodex, another crypto –exchange, halted its operations, and its 27-year-old founder is absconding, probably fleeing the country. Thode has more than 390,000 users. Turkey’s Haberturk newspaper quoting the lawyer representing the users, reported that the loss could be as high as $ 2billion.

Daily Business worth $2 billion in danger

Turkey is gripped with double-digit inflation. The value of its currency, the Lira, has fluctuated wildly and fell by more than 10% against the dollar. The cryptocurrency boom was fuelled partly due to the above factors. The Turkish public trying to protect their savings invested heavily in cryptocurrencies, and the two exchanges was a part of this boom which estimates put as $2 billion daily. There is more to come if we hear Central Bank chief Sahap Kavcioglu warning on television that more regulations are in the pipeline to stop what he said was the flow of money outside Turkey illegally.

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Source: https://www.thecoinrepublic.com/2021/04/25/turkeys-cryptocurrency-pain-extends-with-second-exchange-collapse/


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