The central bank of Turkey has banned the use of cryptocurrencies and cryptoassets to buy goods and services, citing potential “irreparable” harm and significant transaction risks. The move led to sell-off in cryptocurrency market.

The ban begins on April 30.

Turkey's burgeoning cryptocurrency market has picked up steam in recent months as investors have joined the global Bitcoin rally, seeking to hedge against the depreciation of the lira and inflation, which exceeded 16% last month.

Cryptocurrency trading volumes in Turkey reached 218 billion lira ($27 billion) from early February to March 24, up from just over 7 billion lira in the same period a year earlier, according to American researcher Chainalysis analyzed by Reuters.

Royal Motors, which distributes Rolls-Royce and Lotus vehicles in Turkey, was the first in the country to announce this week that it will accept payments in cryptocurrencies. Tech giants like Apple, Amazon, and Expedia also accept such payments.

Bitcoin drifted lower after the news hit the wires and the risk of deeper correction increased considering fragility of the overbought market.

Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to the author, and not to the author’s employer, organization, committee or other group or individual or company.

High Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 73% and 65% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd and Tickmill Europe Ltd respectively. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.