Seizure of Cryptocurrency
Nowadays, developments in technology and informatics have affected many areas of our lives. Although technology is not a concept that emerged in the 21st century, crypto money and block chain have been a time period when the biggest breakthroughs were made in this regard. Thus, this evolution, which impacted the area of economy, has emerged as a new currency worldwide.
Cryptocurrency is an asset that has become widespread today due to its straightforward accessibility and exists in a completely digital environment with block chain technology. One of the most important reasons for the spread of this currency is the digital values that are processed with the password method, not being issued by any central bank or credit institution. Due to its existence on the internet, an environment that everyone can access has been provided. Although cryptocurrencies are similar to money in terms of being a medium of exchange, they do not have the quality of fiat money like TL, USD and Euro as they are not accepted by central banks. Therefore, it can be considered that they should be legally accepted as goods. Nevertheless, since cryptocurrencies are virtual and not intangible, they cannot be considered as goods. The most prominent currency among cryptocurrencies is Bitcoin. Bitcoin transfers are untraceable and the identities of wallet holders are always confidential. Therefore, depending on the use of Bitcoin, states are expected to present some legal regulations on cryptocurrencies, at least within their own borders.
As can be seen, the resources in the Turkish legislation are insufficient in terms of defining crypto money. Therefore, there are controversial issues regarding the confiscation of these currencies, the definition of which has not yet been qualified in Turkish Law. On 11.01.2018, the Under secretariat of Treasury provided information in addition to the announcement made by the Bank Regulation and Supervision Agency and stated that crypto money has no legal basis and therefore no guarantee in Turkish Law. Because the crypto money, which is used so widely today, in large companies with serious monetary value, has the potential to have serious legal consequences. Although cryptocurrencies are values measured in money, foreclosure is not prohibited. Pursuant to the Execution and Bankruptcy Law, the account of the debtor in the bank is checked by sending a lien notice to the bank where the account is held. The same process will be applied for cryptocurrencies, as transactions continue to be made in TL (Turkish Lira) for the currencies in foreign deposit accounts. If the amount in question is kept in TL, the amount found directly, if it is found in crypto, it will have to be converted into TL and transferred.
However, in the regulation made in our country, it is forbidden to subject crypto assets to payment transactions. With the 'Regulation on Not Using Crypto Assets in Payments' issued by the Central Bank of the Republic of Turkey and published in the Official Gazette, the indirect or direct use of cryptocurrencies is prohibited. However, using the said money as an investment tool and performing transactions through banks are not prohibited within the scope of the relevant regulation. In foreign cryptocurrency exchanges in Turkey; It is possible to determine whether the debtor has an investment here. Upon the request of the creditor or the creditor's attorney, a request is sent to the Enforcement Office based on Article 89 of the Enforcement and Bankruptcy Law. Based on this article, domestic crypto exchanges give an answer regarding this; The answer is yes or no. A lien is applied to the amount of the debtor's debt.
Enforcement law rules also mention that money or security will be received for execution without judgment. In addition to the fact that cryptocurrencies are not legally in the nature of money, they can be subject to follow-up in TL equivalent of crypto money in a possible execution proceeding. Similarly, it is possible to receive money in the follow-up specific to bills of exchange. It is a matter of money that crypto money cannot be subject to bills such as bills, checks since it is not legal money. In the case of a contract between the parties that creates a crypto currency debt, the ways that the creditor can apply are different depending on whether the crypto money is legally accepted as money. Since crypto money is not officially recognized as money, it can be thought that it is not possible to apply for enforcement without a verdict regarding crypto money receivables. Because the enforcement procedure without judgment is a method that only those whose subject is money are resorted to.
As a concrete example, in return for the creditor's receivable of 60 thousand liras, he applied to the 14th Enforcement Directorate of Istanbul and requested a lien on the debtor's account in a Turkey-based cryptocurrency exchange. Accordingly, on March 5, 2021, the enforcement office placed a lien on the debtor's cryptocurrencies. In addition, the debtor's hot wallet account has been blocked. Upon the objection of the debtor's attorney, the enforcement court decided to reject the complaint, stating that such currencies are considered as a kind of digital currency or virtual currency, and therefore can be seized. Because if the seized thing is accepted as money, there will be no need to sell it and the creditor will be able to directly demand the seized money.
Assets of monetary value can be confiscated unless the law prohibits the seizure of such property. Cryptocurrencies have monetary worth and are not prohibited by law. For this reason, there is no theoretical obstacle to the confiscation of cryptocurrencies belonging to the debtor. It is an important shortcoming that it has not yet been placed in a legal status in Turkish Law, although it is common today and is a problem that occupies our timetable. There is no doubt that the technology of cryptocurrencies will change our lives economically and commercially in the very near future and bring many creations to our daily lives. Anything that is owned by the debtor and has a monetary value can be impounded. First, if the legal status of crypto money is defined and a path is followed accordingly, uncertainties will be eliminated.
Zeynep Özden
Bibliography:
1) https://www.resmigazete.gov.tr/eskiler/2021/04/20210416-4.htm
2)https://www.aa.com.tr/tr/turkiye/borclunun-kripto-parasi-haciz-islemi-icin-menkul-kiymet-olarak-sayildi/2214609
