The Vebitcoin crypto exchange in the southwestern city of Mugla in Turkey has gone offline. The homepage of the company’s website highlights recent developments that have forced them to cease trading.
“Due to recent developments in the cryptocurrency industry, our transactions have become much more intense than expected. We regret to say that this situation has led us to a very difficult process in finance. We have decided to stop our activities in order to comply with all regulations and requirements. We will inform you as soon as possible.“
Local media reports that CEO Ilker Bas was arrested along with several other employees. There is currently no information on user funds. When the second Turkish stock exchange collapses in just as many days, crypto investors in the country sway from the double blow.
Crypto security now firmly in the spotlight
Vebitcoin was founded in August 2017 and made a small number of cryptos available to Lira trading pairs. BTCTRY accounts for more than half of its volume and no crypto-to-crypto pairs are offered.
The most recent 24-hour volume shows it is trading for $ 58 million, making the market share relatively small. After his arrest, Bas informed the police that 90,000 users were registered on the platform.
Last week the Thodex crypto exchange collapsed and authorities tried to track down its CEO, Faruk Fatih Ozer. The platform denies any wrongdoing and makes a statement that its website is unavailable due to a contract with outside investors.
A search is currently underway for Ozer who may have fled to Albania or Thailand. Thodex has 390,000 active users and Ozer is believed to have raised $ 2 billion in user funds.
Turkey experienced a crypto boom due to the deteriorating economic conditions in the country. With an inflation rate of 16% last month and the ongoing weakness of the Turkish lira, many had turned to crypto to protect themselves.
But with the collapse of Vebitcoin and Thodex in rapid succession, the cryptocurrency’s reputation in the country has taken a blow. Orkun Godek, head of research at Deniz Investment, said tighter regulation was needed after the collapses.
Turkish central bank rules out ban
Turkey had already ordered to ban cryptocurrencies for the payment of goods and services. A statement from the central bank read:
“They are neither subject to regulatory and monitoring mechanisms nor a central regulatory authority. Their market values can be overly volatile. “
After the collapse of Vebitcoin, many feared that the central bank would take the opportunity to impose even stricter restrictions. Governor Şahap Kavacıoğlu told the state TV broadcaster TRT that regulations are coming, but there won’t be an outright ban.
“You can’t fix anything by banning crypto, and we don’t intend to.”
Kavacıoğlu did not comment on what future regulations would mean. only that this would clarify the legal definition of crypto and custody account requirements for institutions.