Turkey To Restrict Access To Offshore Forex Trading Sites
Turkey is in the news lately for its attempted campaigns at kerbing the Foreign Exchange trading done by small investors on a large scale. The government has recently released a report in which it is stated that the citizens of Turkey who are carrying out unauthorised foreign exchange transactions using offshore services or sites will be barred completely.
Nurettin Canikli who is the Deputy Prime Minister of Turkey has said that the government is working on new legal regulations that will be placed on the citizens of the nation that would not allow anyone to access any sites and carry out foreign exchange without prior permission.
Canikli has made the following statement to media:
If the citizens of the Republic of Turkey have access to the area and site engaged in forex trading abroad without permission, we will prevent the access to those areas.
According to the Deputy Prime Minister, it is just a matter of short time that the country will start seeing the new laws. He has further highlighted that the earlier restrictions introduced by CMB or Capital Markets Board are clearly in force. The new rules will save small investors by approximately $300 million per day on average. According to a media report, after the new rules were imposed, the daily trading volume in foreign exchange has declined to $2 billion.
As per Canikli, the government is not having any kind of problems regarding foreign exchange market and asserted that the new rules were accurate. He fears that if new laws are not implemented soon, the country will be in the throes of a digital gambling house. He blames the trading sites that run extensive ad campaigns in order to lure the small and inexperienced traders into risking their money in foreign exchange market. The daily trading volume of Turkey has reached to $17 billion and small investors have incurred heavy losses.
CMB has issued some restrictive measures in the foreign exchange where trading leverage was lowered from 100:1 to 10:1 and the minimum deposit limit has been set at 50,000 Turkish Lira. According to Deputy PM, the new rules did not affect the depth of market.
However, there are growing concerns amongst genuine investors because the new rule will hamper their active participation in foreign exchange market. The ban might allow the Turkish investors to make use of unregulated offshore traders. This concern has been addressed by the latest measure. According to a media report, losses suffered from the foreign exchange market were in the vicinity of $500 million. Between the time period, 2011 and 2016 September, around 120,000 people have opened foreign exchange trading accounts.
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