The price of bitcoin (BTC-USD) fell from a record high on Friday after a decision by the Central Bank of Turkey to ban cryptocurrencies for payments.
The Central Bank of the Republic of Turkey (CBRT) has said that the use of cryptocurrencies and other cryptocurrencies based on distributed book technology will be banned as payment, whether directly or indirectly.
The ban will take effect on April 30 this year.
“Payment service providers will not be able to develop business models in a way that cryptocurrencies are used directly or indirectly in the provision of payment services and electronic money and will not be able to provide services related to such business models,” CBRT said in a statement.
The CBRT said the ban was motivated by a lack of “central authority regulation” and “oversight mechanisms” for cryptocurrencies and other similar digital assets.
It says that, among other risks, cryptocurrencies “may cause irreparable losses to transaction parties” due to a lack of regulation.
A statement from the bank added that payments could “include elements that could undermine confidence in the methods and tools currently used in payments”.
Bitcoin fell more than 3% to 61,379 dollars (44,670 British pounds) in morning trading in London.
Demand for cryptocurrencies in Turkey has been boosted recently by inflationary pressures and the weaker Turkish lira. Annual inflation in the country rose above 16% in March.
Prior to the announcement, Turkish authorities requested consumer information from trading platforms last week.
WATCH: What is bitcoin?
Cryptocurrency prices have reached record highs in recent weeks due to growing demand.
Bitcoin, which has been rising and falling over the past few weeks, broke another record on Wednesday, reaching $ 64,717.01.
On Thursday, Ethereum (ETH-USD) – the second largest cryptocurrency in the world – continued its multi-month rally, reaching a record level of $ 2,488.07. It was close to 2% on Friday morning.
On Wednesday, the cryptocurrency exchange Coinbase became the first crypto firm to publish on the Nasdaq (^ IXIC).
Coinbase, the largest cryptocurrency exchange in the United States, was briefly worth more than $ 100 billion when it debuted at the Nasdaq on Wednesday. The stock ended its first trading day at $ 328.28, opening at $ 381.
WATCH: What are the risks of investing in a cryptocurrency?