Can Payment Be Made With Cryptocurrency?

Payment is a legal process. It is one of the processes that ends the debt as a breed. The payment phrase is used in many places in our legislation. For example, the phrase payment is used 87 times in the Turkish Civil Code, which consists of 1030 issues, 185 times in the Turkish Code of Obligations, which consists of 649 issues, and 401 times in the Turkish Commercial Code, which consists of 1535 issues. However, none of them include the definition of “payment”.

Turkish Code of Obligations m. 99 and 100 are remarkable at this point…

TBK m. The title 99 is “Payment”, but it is not about what the payment is, but how it is made. As a matter of fact, the debt, which is the subject of money, is paid in the country’s currency. From the meaning of the opposite, it means that the debt, which is not the subject of money, can be paid in the currency of the country, or it can be paid in a currency other than the country’s currency. If, in the continuation of the element, it is decided to pay in a currency other than the country’s currency, it is said that the debt can also be paid in the country’s currency at the current rate on the payment day, unless there is a fixed payment or a term that has this meaning in the contract. This sentence is for foreign currency debts. There is no repayment schedule. Continuing; In the event that the debt is not paid on the payment date, unless it is determined in a currency other than the country’s currency and there is no motamo payment in the contract or a promise with this meaning, the creditor may request that this receivable be paid in the country currency over the motamot or the current date of the maturity or the actual payment date, this is about how to pay for foreign currency debts.

TBK m. 100 carries the title of offset. Accordingly, if the debtor is not late in paying the interest or expenses, he has the right to deduct the partly payment from the main debt. On the contrary, it cannot be negotiated. If the creditor has taken a surety, pledge or other guarantee for a part of the receivable, the debtor does not have the right to set off the payment made in part to the part that is secured or that has a higher guarantee. We are looking for it, but it is not possible to find an answer to the question of what is the payment.

TBK m. 139 is remarkable here. About the swap. Accordingly, if two persons are mutually indebted to each other for a measure of money or other identical acts, if both debts are due, each can exchange their receivables with their debts. In other words, money is open to exchange with money, and other items are open to barter with another kind of item. But this is not a payment. It can end the debt for payment, but a swap is different from a payment.

When we look at the subject from the point of view of the Law No. 6493 on Payment and Securities Settlement Systems, Payment Services and Electronic Money Institutions, we see that the phrase 202 payment times is mentioned in the Law. However, there is no definition of the phrase “payment” in this Law.

Law No. 6493 m. 3 means of payment; It defines a personal vehicle such as a card, mobile phone, password, etc., which is determined between the payment service provider and the user and used by the payment service user to give the payment order. If the payment order is; in the form of an instruction given by the payment service user to the payment service provider for the realization of the payment process. According to the law, the payment account is the account opened in the name of the payment service user and used for the execution of the payment process. The Law points out the payment service one by one with a long list of examples. For example;

All processes necessary for the operation of the payment account, including services that allow depositing money into the payment account and withdrawing money from the payment account,

Direct debiting process, including the one-time payment process, which includes the transfer of funds in the payment account of the payment service user with the payment service provider, the payment process made with a payment card or a comparable instrument, and money transfer, including a regular payment order,

Issuance or acceptance of the payment instrument,

money order,

The payment process in which the consent of the sender to make the payment process is given via an information or electronic communication device and the payment is made to an information or electronic communication operator operating only as an intermediary between the payment service user and the provider of goods or services,

Services for mediating invoice payments,

At the request of the payment service user, the payment order initiation service provided for the payment account in another payment service provider,

Provided that the approval of the payment service user is obtained, the service of presenting the consolidated information of one or more payment accounts of the payment service user on online platforms,

Other processes and services, payment services, which reach a level to be determined by the Bank in terms of total size or area of ​​influence in the field of payments, however, do not answer the question of what is repayment.

The closest answer to the question of what is the payment is in the payment process description. The 3rd element of the law says for the payment process: “the activity of depositing, transferring or withdrawing funds carried out on the order of the sender or the receiver”. The magic word here is background. The fund, on the other hand, is referred to as banknotes, coins, fiat money or electronic money, just as in Article 3 of the Law. So, these can be funds. However, depositing, transferring, withdrawing them is a payment process. Then, according to the Law, depositing, transferring or withdrawing anything other than banknotes, coins, cash or electronic money is not a payment process.

We have examined all this in order to better understand the Regulation on the Non-Use of Crypto Assets in Payments issued based on Law No. 6493. This Regulation aims not to use crypto assets in payments, not to use crypto assets directly or indirectly in the provision of payment services and issuance of electronic money, and to payment and electronic money institutions’ platforms that offer trading, custody, transfer or issue services of crypto assets or fund transfers from these platforms. defines it as determining the methods and principles of not mediating.

The support of the regulation is the sub-paragraph (f) and fourth paragraph of the third paragraph of the third paragraph of the 4th point of the Central Bank of the Republic of Turkey Law No. 1211 dated 14/1/1970 and the Payment and Securities Reconciliation No. 6493 dated 20/6/2013. Systems, Payment Services and Electronic Money Institutions are shown as the third paragraph of the 12th article and the sixth paragraph of the 18th article of the Law.

The regulation basically prohibits the use of crypto assets in payments. Accordingly, in the implementation of the Regulation, crypto assets, distributed ledger technology or intangible assets that are created virtually using distributed ledger technology and distributed over digital networks, but whose prestige are not considered money, fiat money, electronic money, payment instruments, securities or other capital market instruments. is defined as.

According to this regulation, crypto assets are not “FON” in 6493. Because the Law defined and terminated the Fund as banknotes, coins, cash or electronic money. The regulation, on the other hand, confirms that crypto assets are not funds. According to the Law, the payment process only takes place with the FON. Both the Law and the Regulation express emphatically that crypto assets are not a FON. Afterwards, while the Law defines Fund transfers as a payment process, it points out that crypto money transfers are not a payment process; The regulation, on the other hand, states that crypto assets cannot be used in payments, but not in payment processes. This point has led to an important generic contradiction and flaw. Because, according to the Regulation, crypto assets cannot be used directly or indirectly in payments.

The Turkish version of the Regulation, which prohibits even the indirect payment of which we do not know directly, can be translated as “Absolutely Forbidden Fellow”. When you don’t understand what is prohibited, everything about the issue seems to be prohibited. This means a violation of the basic element of proportionality in administrative restraint. It turns out that the prohibition of use in payments and the prohibition of use in payment processes are the same thing? Or is it something different? If the payment processes are the same, if the payment processes are limited to the fund and the crypto fund is not, the crypto transfer cannot be accepted as a payment and cannot be charged within the scope of the ban.

Well, if it is evaluated that there is a process against this Regulation, what is the penalty for this? There is no sanction or penalty in the regulation. In accordance with the principle of legality in error and punishment, crime and punishment can only be regulated by law. Unfortunately, at this point, we are faced with a Regulation that does not have a clear sanction. If the basic principle is legality in error and punishment, there is no sanction for violating this Regulation. Come see that Law No. 6493 m. 27, “On legal individuals acting as system operators or payment service providers and acting unconventionally on the issues included in this Law and in the regulations and decisions to be enacted based on this Law and for which no other penal sanction is foreseen in this Section, the Bank’s Administrative Committee has decided from forty thousand Turkish lira to nine hundred An administrative fine of up to one thousand Turkish lira is imposed. However, in case of gaining benefit or causing loss in this way, the size of the administrative fine to be imposed cannot be less than twice of this benefit or the damage caused.

If one of these misdemeanors is committed more than once until an administrative sanction decision is made, an administrative fine is imposed on the person concerned and the penalty to be imposed is doubled. However, in the event that an advantage is obtained or a loss is caused by committing this misdemeanor, the measure of the administrative fine cannot be less than three times of this benefit or loss” as a sanction of wrongdoing in the Regulation. The phrase “acting against the issues in this Law and in the regulations and decisions to be enacted based on this Law and for which no other penal sanction is foreseen in this Section” in this element means that the element of legality is punctured right in the middle of the crime. In other words, although there is no error in the Law, it is understood that the violation of the Regulation can be subject to the penalty in the Law.

Unfortunately, this Regulation, which is wrong in all respects and not accustomed to the law-making technique, has been in force for more than 1 year. The scope, subject and concept of the Regulation is not clear and the sanctions are not legal or foreseeable. What needs to be done is either to repeal this Regulation quickly or to make a regulation in accordance with the current and basic legal principles within the scope of the general regulation planned to be made regarding crypto assets. Let’s see, which of these two options will time bring us? As we mentioned, will the Regulation be repealed? Or will the issue be addressed in crypto regulation? Or will the Regulation remain in force for years in its incomplete and erroneous form by forgetting it?

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