Legal Framework, Offence Types, the Payment Ban and the Competent Courts
Introduction
Millions of people in Türkiye use crypto assets, yet the legal consequences are often not sufficiently foreseen when transactions are made. In practice, the cases that reach lawyers stem less from the technical structure of crypto assets than from the breakdown of the legal relationships built around them.
Clients often find themselves facing problems such as:
· An access block on a crypto exchange,
· Inability to withdraw assets held in an account,
· Unauthorised transfers carried out by third parties,
· Fraud committed under the guise of an “investment promise”,
· A payment made in crypto being treated as invalid
and similar issues.
This article takes a practice-oriented approach to how crypto-asset disputes arise in practice, which legal rules govern them, which acts constitute criminal offences and how the competent court and venue are determined.
THE LEGAL FRAMEWORK FOR CRYPTO ASSETS IN PRACTICE AND TYPES OF DISPUTE
A. How Crypto-Asset Disputes Arise in Practice:
Disputes involving crypto assets usually stem not from the complexity of crypto technology, but from legal and factual relationships around these assets that were set up without foresight. A review of the cases that reach lawyers shows that disputes recur around certain typologies. A systematic look at the ways in which crypto-asset disputes arise in practice is therefore important for correct legal characterisation and for building an effective litigation strategy.
1. Disputes Arising from Crypto Exchanges
One of the most common types of dispute in practice arises from the relationship between crypto-asset service providers (crypto exchanges) and their users. These disputes are mostly shaped by the user agreement concluded between the parties and the way in which that agreement is applied.
The problems most frequently brought to lawyers in this context are:
· Sudden suspension or closure of a user’s account without stated reasons,
· Inability to withdraw the crypto assets or Turkish lira balance held in the account,
· The platform imposing trading restrictions on technical, audit, security or compliance grounds,
· The crypto exchange suspending its operations or becoming inaccessible in practice.
In such cases, the core debate centres on the limits within which the exchange has exercised its trading and restriction powers. In practice, most exchanges reserve broad powers in their user agreements; those powers must, however, be assessed in light of the principle of good faith, the principle of proportionality and consumer protection rules.
From the lawyer’s perspective, the key questions to be answered at the outset in such cases are:
· Does the user qualify as a consumer?
· Does the dispute concern performance of the contract, or a wrongful act?
· Is the suspension or restriction based on a specific, documented and proportionate reason?
The answers to these questions are decisive both for identifying the competent court and for establishing the legal basis of the claim.
2. Transactions Carried Out by Third Parties (Unauthorised Access and Transfers)
A significant share of crypto-asset disputes arises from transactions carried out without the user’s consent. Such cases often have a complex structure combining criminal law and private law dimensions.
The scenarios most frequently encountered in practice are:
· Takeover of the user’s crypto exchange account,
· Unauthorised transfer of the crypto assets in the account to third parties,
· Users being pressured, through social engineering methods (fake customer service, fake apps, phishing), into sharing their passwords or verification codes.
The core legal issue in such disputes is whose fault caused the loss. Crypto exchanges often deny liability by arguing that the transactions were carried out using the user’s own access.
From the lawyer’s perspective, the critical points in these cases are:
· How the unauthorised transactions were carried out technically,
· Whether the platform’s security measures were adequate,
· Whether the user was grossly negligent,
· Whether the exchange fulfilled its risk disclosure and information obligations.
Such cases are generally assessed:
· Under criminal law, as fraud committed through information systems or as cybercrime,
· Under private law, within the framework of tort, breach of contract or strict liability.
3. Investment Promises and Crypto Fraud
In the crypto-asset field, the disputes with the most serious consequences in practice arise from fraud carried out through investment promises. Such cases often display an organised and systematic structure.
Methods frequently encountered in practice include:
· Promises of “high returns in a short time” or “risk-free investment”,
· Individuals presenting themselves as investment advisers, portfolio managers or crypto experts,
· Investment groups set up on Telegram, WhatsApp and similar messaging apps,
· Collection of money and crypto assets through fake platforms or redirections.
Although the legal relationship in such disputes often looks like an ordinary contractual relationship, in substance the victim’s will is vitiated by deceptive conduct. For this reason, these cases are predominantly dealt with as the offence of aggravated fraud.
From the lawyer’s perspective, the key points to watch in these cases are:
· Identifying the perpetrator or perpetrators and establishing any organised activity,
· Ensuring that money and crypto-asset transfers can be traced,
· Pursuing civil compensation claims in parallel with the criminal investigation.
Failing to plan the evidence properly at an early stage in such cases can lead to losses of rights that are difficult to remedy.
B. Key Legislation on Crypto Assets in Türkiye
For a long time, the legal regime for crypto assets in Türkiye was shaped by fragmented and indirect rules, which caused serious uncertainty in practice. With the legislation of recent years, however, the legal status of crypto assets and the boundaries of activity in this field have become largely clear. Within this framework, two key rules stand out as those most often encountered in practice and having direct legal consequences: the prohibition on using crypto assets as a means of payment, and the inclusion of crypto-asset service providers within the capital markets regime.
1. Prohibition on Using Crypto Assets as a Means of Payment (CBRT Regulation)
The rule that crypto assets cannot be used as a means of payment in Türkiye has been expressly laid down by the regulation issued by the Central Bank of the Republic of Türkiye (CBRT). Under this regulation, crypto assets do not legally qualify as “money” or a “means of payment”, and are not accepted as a valid means of paying for goods and services.
This prohibition is less a theoretical limitation than a rule with direct and significant legal consequences in practice. In disputes frequently encountered by lawyers, one party argues that a debt was discharged by a crypto-asset transfer, while the other claims that the debt has not been extinguished. Under the current legal framework, the defence “I paid in crypto” is, as a rule, not accepted as a valid payment for the purposes of discharging a debt.
The practical implications of this can be summarised as follows:
A crypto-asset transfer is not treated as valid performance that extinguishes the debt; in most cases it becomes the subject of debate as performance in lieu of performance (datio in solutum), performance on account of performance (datio solvendi causa) or unjust enrichment.
Even where the parties have agreed on payment in crypto, if a dispute arises, the validity of that arrangement in the face of mandatory rules of law becomes seriously contested.
Particularly in commercial relationships, where payments made in crypto are later treated as invalid, secondary disputes arise between the parties over matters such as whether the creditor–debtor relationship has ended and liability for interest and default.
For this reason, in contracts connected with crypto assets, the means by which the payment obligation is to be performed is not merely a technical matter or one of party choice; it is a legal issue directly linked to public order.
2. Law No. 7518 and the Subjection of Crypto-Asset Service Providers to the CMB Regime
The most fundamental change in Türkiye’s crypto-asset landscape was brought about by Law No. 7518. With this Law, crypto-asset service providers (CASPs) were brought, for the first time, within a clear, systematic and binding legal framework and made subject to the oversight and supervision of the Capital Markets Board of Türkiye (CMB, SPK).
Following this legislation, crypto-asset service providers have become institutional structures that are:
required to obtain authorisation and a licence in order to operate,
subject to administrative supervision of their activities,
liable, in the event of non-compliance with the legislation, to face criminal liability in addition to administrative sanctions.
This is the institutional status they now hold.
In practice, the most important consequence of this legislation is that crypto exchanges have largely lost the ability to escape liability by positioning themselves as a “technological intermediary” or a “free platform”. The obligations of crypto-asset service providers regarding user agreements, risk disclosures, security measures and the protection of client assets are now treated, beyond an ordinary private law relationship, as an activity with a public law dimension.
For lawyers, this new regime has the following practical consequences:
Defences that crypto exchanges are “purely free-market actors” have lost much of their force.
Platforms’ trading restrictions, account closures and asset freezes are now open to administrative and judicial review.
In claims for losses caused by an exchange, it is possible to litigate not only on the basis of the contract terms but also on non-compliance with the legislation and breach of regulatory obligations.
In this respect, Law No. 7518 has broadened the set of legal arguments available to lawyers in crypto-asset disputes and has created a stronger normative basis, particularly in cases aimed at protecting users.
C. The Offence Types Most Frequently Encountered in Practice in Connection with Crypto Assets
Owing to their technical infrastructure and the perception of anonymity, crypto assets create an area open to abuse from a criminal law perspective. In practice, crypto-related offences appear as traditional offence types committed through digital means; however, the legal characterisation of these acts often requires particular care and technical assessment. A review of the cases that reach lawyers shows that criminal investigations relating to crypto assets are concentrated around certain offence types.
1. Aggravated Fraud Committed through Information Systems
The most common offence type in the crypto-asset field is aggravated fraud committed by exploiting the opportunities offered by information systems. In such cases, the perpetrator or perpetrators exploit the technical complexity of the crypto-asset market and investors’ lack of knowledge to vitiate the victims’ will through deceptive conduct.
In practice, this offence type is mostly encountered through the following methods:
False or exaggerated promises of investment returns,
Creating an impression of expertise or competence in crypto markets,
Reaching large audiences through digital platforms, social media or messaging apps,
Several individuals acting in a coordinated manner to build a relationship of trust.
The main reason such acts constitute the aggravated form of the offence is that the deceptive conduct is carried out through information systems and the victim’s economic decision-making is steered in this way. In practice, in investigations into crypto-asset fraud, it is critical to show that the perpetrator’s actions were carried out with intent to deceive from the outset, rather than amounting to a mere failed investment.
2. The Offence of Breach of Trust in Relation to Crypto Assets
Another offence type frequently encountered in crypto-related criminal investigations involves acts carried out on the basis of a relationship of trust that subsequently cause harm. In such cases, the perpetrator gains access to the victim’s crypto accounts or digital wallets with the victim’s consent, but then uses that authority beyond its intended purpose and disposes of the assets for their own benefit.
In practice, this offence type mostly arises through:
The management of a crypto account being handed over to a third party,
Crypto assets being entrusted for investment or safekeeping purposes,
Misuse of access authority granted for a specific period or purpose
among other scenarios.
At the centre of the legal debate in such cases lies the scope of the relationship of trust established between the parties and the stage at which that relationship was breached. What matters for the lawyer here is correctly determining whether the act is a mere breach of contract or an act that reaches the level of breach of trust in the criminal law sense.
3. The Offence of Embezzlement in Relation to Crypto-Asset Service Providers
With legislation that has recently entered into force, the activities of crypto-asset service providers have been made subject not only to private law but also to a special liability regime under criminal law. In this context, the use by platform managers or officers of client assets for their own benefit or that of third parties is assessed as a special offence of embezzlement, independently of the traditional offences of fraud or breach of trust.
The distinguishing feature of this offence type is that the offence is committed through acts whereby the perpetrator:
Has the power to dispose of client assets within the scope of a specific duty or authority,
Uses that authority outside the limits set by the legislation,
Breaches the obligations relating to the protection of client assets
as described above.
In practice, this provision has largely neutralised the defence of crypto-asset platforms that they are “technical intermediaries”, and has exposed acts involving the misuse of client assets directly to criminal sanctions. This provides an important legal basis not only for companies operating in the crypto-asset field but also for lawyers acting on behalf of aggrieved users.
D. Legal Consequences of Crypto Assets Not Qualifying as a Means of Payment
One of the questions most frequently raised in practice in crypto-asset disputes concerns the effect of a crypto-asset transfer on performance in a debt relationship. In light of the rules in force in Türkiye, it is clear that crypto assets are not legally recognised as a means of payment and therefore do not have the effect of extinguishing a debt.
Within this framework, a claim that a debt was discharged by a crypto-asset transfer is, as a rule, not regarded as a valid payment showing that the debt has been extinguished. Accordingly, even if the creditor has received crypto assets, it may retain the right to claim its principal receivable. In practice, this leads to serious legal disputes in which the debt is argued to subsist despite the claim that payment has been made.
The legal nature of crypto-asset transfers may be assessed differently depending on the circumstances of the specific case. In most cases, these transfers are treated as a performance made in lieu of discharging the debt, as a transfer of assets whose legal cause is disputed or, depending on the legal relationship between the parties, as falling within unjust enrichment or tort. This shows that a crypto transfer does not, on its own, extinguish a debt; on the contrary, it becomes the source of new and complex disputes.
For this reason, in cases involving crypto assets, the first assessment lawyers need to make is to correctly identify the legal nature of the “payment” claim put forward by one of the parties. The nature of the payment claim directly affects which type of action is to be brought, the heads of claim that may be pursued and the legal regime that will apply. The fact that crypto assets do not qualify as a means of payment emerges as a fundamental issue that can cause errors of legal characterisation in disputes in this field to have consequences that are difficult to remedy.
E. Determining the Competent Court and Venue in Disputes Involving Crypto Assets
One of the most common mistakes in crypto-asset disputes is choosing the wrong judicial track by focusing on the technical nature of the dispute. Crypto assets do not, however, create a separate jurisdiction; under the existing rules of procedural law, the competent court and venue must be determined according to the legal nature of the dispute. For this reason, the first assessment in cases involving crypto assets is to establish clearly whether the dispute falls within criminal law, private law or enforcement law.
1. Subject-Matter Jurisdiction and Venue in Criminal Cases Involving Crypto Assets
In criminal investigations connected with crypto assets, the competent court is determined according to the legal nature of the alleged act. A significant proportion of the cases encountered in practice are assessed as fraud committed using information systems; depending on the seriousness of the specific case, such acts fall within the jurisdiction of the Criminal Court of First Instance (Asliye Ceza Mahkemesi) or the High Criminal Court (Ağır Ceza Mahkemesi). In particular, for fraud committed through crypto assets that involves aggravating circumstances, the competent court is the High Criminal Court.
As regards venue, crypto offences often have connections with more than one place. The place where the perpetrator is located, the place where the victim is located and even the places where the technical infrastructure was used may, in theory, be the subject of a venue dispute. In practice, however, the prosecutors’ offices and courts of the victim’s place of residence are frequently accepted as having venue, since that is where the harm actually materialises. This approach offers a practical solution, particularly in that it takes as its basis the place where the victim’s economic loss becomes concrete.
For lawyers, venue in criminal cases is not merely a procedural detail; it is of strategic importance for the effectiveness of the investigation, access to evidence and the protection of the victim.
2. Subject-Matter Jurisdiction and Venue in Civil Cases Involving Crypto Assets
In private law disputes connected with crypto assets, the competent court depends on the nature of the relationship between the parties. In practice, disputes between crypto-asset service providers and individual users are particularly prominent. In such disputes, since the user is in most cases not acting for commercial or professional purposes, the user is regarded as having consumer status. In that case, the competent court is the consumer court, and venue is regulated in favour of the court of the consumer’s place of residence or the place where the transaction was carried out.
By contrast, where a crypto-asset dispute arises between two natural persons and there is no consumer relationship between them, the dispute is subject to the general provisions. In that case, the competent court is the Civil Court of First Instance (asliye hukuk mahkemesi), and venue lies with the court of the defendant’s place of residence or, where the dispute arises from a tort, the court of the place where the damage occurred.
At this point, the technical nature of crypto-asset disputes does not change the determination of subject-matter jurisdiction and venue; it simply makes it essential to characterise correctly the legal relationship on which the dispute is based. Actions brought before the wrong court are dismissed on procedural grounds without any examination of the merits and may lead to serious losses of rights.
3. Venue and Practical Issues in Enforcement Proceedings Involving Crypto Assets
The position of crypto assets under enforcement law is one of the areas that causes the most uncertainty in practice. Under the current legal order, since crypto assets are not tangible property in the traditional sense, they are not regarded as assets that can be directly attached. However, where crypto assets are held in accounts with an exchange or service provider, attachment can be imposed on those accounts.
In enforcement proceedings, the enforcement office with venue is, under the general rule, the enforcement office of the debtor’s place of residence. However, where crypto assets are held with exchanges acting as third parties, practical protection can be obtained by sending a garnishment notice to the third party. The key point for lawyers here is to focus not on the technical existence of the crypto asset but on which person or institution has actual control over it.
The fact that crypto assets cannot be directly attached under enforcement law does not mean that enforcement proceedings are impossible in this area; on the contrary, it requires a more careful and technical enforcement strategy.
F. CONCLUSION
Although crypto assets may at first sight appear incompatible with traditional legal institutions because of their technical infrastructure and digital nature, an examination of the disputes arising in practice shows that this area can largely be resolved using the tools of the existing legal system. The legislation adopted in Türkiye in recent years has taken crypto assets out of the realm of activity beyond legal oversight and turned them into a field of activity subject to specific rules and sanctions. This transformation means that crypto-asset disputes must now be treated not merely as technical or economic matters, but as a multi-layered legal issue.
The cases that reach lawyers in practice are shaped less by crypto assets themselves than by the legal nature of the contracts, relationships of trust and payment claims built around them. In particular, the fact that crypto assets are not accepted as a means of payment requires the concept of performance in debt relationships to be reinterpreted, with significant consequences under both private law and criminal law. Similarly, bringing crypto-asset service providers within the capital markets regime has widened the scope of platforms’ liability and strengthened the legal protection of users.
From a criminal law perspective, crypto-related offences often appear as traditional offence types committed through digital means; however, the manner in which the offence is committed and the structure of the evidence require particular expertise during investigation and prosecution. In this area, determining the correct characterisation of the offence directly affects not only the type of criminal sanction but also the victim’s rights to compensation and to recover receivables.
Determining the competent court and venue is one of the most critical stages in crypto-asset disputes. If the legal nature of the dispute is not correctly identified, even strong claims backed by technical knowledge may fail on procedural grounds. Success in crypto-asset cases therefore depends to a large extent on choosing the correct judicial track and on positioning the dispute accurately within the existing legal rules.
In conclusion, crypto-asset law in Türkiye is in a dynamic process of development. While the legal risks for natural and legal persons operating in this area are becoming increasingly varied, crypto-asset disputes have also become, for lawyers, a specialist field requiring interdisciplinary knowledge and rigorous legal characterisation. In light of the current legislation and practice, the decisive factor in resolving crypto-asset disputes is, rather than technological detail, establishing the correct legal method and applying the procedural rules effectively.
Att. Kevser Öztürk
GlobalB Law
05332118645