Crypto exchange Coinbase is dropping out of Turkey’s crypto market and liquidating its Turkish operation after withdrawing its application with the country’s financial regulator.  

Türkiye Today reported that the country’s Capital Markets Board updated its company liquidation list last week. It noted that Coinbase had withdrawn its three-month-old pre-application and filed for liquidation. 

When asked to comment on the withdrawal, Coinbase told Protos it, “Continually assesses potential markets for expansion,” and that it “remains adaptive to evolving market conditions, regulatory landscapes, and our internal priorities.”

Read more: Coinbase to delist WBTC months after Justin Sun controversy

A total of 14 companies have reportedly filed for liquidation and 77 firms are going through the application process. Some crypto companies that have applied include Binance, Kucoi, and OKX.

Oddly enough, Binance and KuCoin removed the Turkish language options from its website and app last September while also discontinuing marketing to Turkish users. Binance claimed this would allow it to comply with Turkish laws for non-Turkey-based crypto asset service providers.

Starting this December, Coinbase stopped offering yields on USDC in Europe which it claims was due to the European Union’s Markets in Crypto-Assets (MiCA) stablecoin law. 

Many X users weren’t happy with the USDC yield shuttering. The co-founder and CEO of Sablier commented sarcastically, “Very grateful to the EU for protecting me against earning a yield on my USDC holdings on Coinbase.” This prompted a wave of similar comments from users across X.  

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Faruk Fatih Özer once took a hardware wallet holding $2 billion worth of crypto through airport security while fleeing arrest. This week, he is entering prison to start a 11,196-year prison sentence.

Özer founded Thodex, Turkey’s once-largest crypto exchange, and used it — with help from his family — to steal untold sums from his customers.

His brother and sister received the same, 11,196-year sentence. That is, the judge noted, more years than 50 humans could physically serve and the longest sentence ever handed down by a Turkish court.

Read more: Thodex chief denies fraud, says crypto exchange was hacked

During his final days of freedom, Özer had grown his beard out to his chest and was taxiing to southern Albania with a tent, intending to camp along the coastline. Law enforcement eventually found him at a social gathering.

By then, he had no hardware wallet containing $2 billion, claiming he’d emptied it, used the funds to pay back victims, and thrown it into the Ionian Sea.

The Istanbul Superior Court didn’t even comment on that extraordinary claim when handing him and his siblings a combined 43,000-year sentence.

It took 62 arrests and coordinated law enforcement across a half dozen countries to finally find Özer. Throughout all of this and even at his final sentencing, Özer denied allegations of fraud and claimed that a third-party hacker stole funds from his exchange.

Faruk Özer is now in prison until his 11,196 year and 10 month sentence expires in the year 13,221.

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Israel’s intelligence service has been accused of using crypto to recruit spies in Turkey as it seeks to track down and kidnap Palestinians living in the country, Turkish authorities claim. 

As reported by the Financial Times on Tuesday, Turkey’s interior minister Ali Yerlikay announced the detention of 34 people linked to Mossad following raids across the country. 

According to a senior Turkish official, suspects “were involved in reconnaissance, surveillance, assault, and kidnapping operations and/or plots targeting foreign nationals in [Turkey] on Mossad’s behalf.”

Reuters reports that the Turkish official claims that recruits were paid by Mossad through intermediaries, live couriers, and crypto so that funds couldn’t be traced back to the agency. 

In addition, the official said that job listings posted online asked recruits to photograph targets, plant cars with GPS devices, and assist Israeli agents “for their ultimate mission.” Mossad reportedly trained suspects abroad and kept regular contact with them via encrypted messaging platforms.

Read more: White House urged to curb Hamas crypto use amid escalating crisis in Gaza

The raids were conducted by the country’s government counter-terrorism and intelligence agencies, and it’s reported that €150,000 ($165,100), an unlicensed firearm, and ‘digital materials’ were seized.

Tensions between Turkey and Israel have escalated following the war in Gaza. Last month, Turkey’s president Recep Tayyip Erdoğan said Israel would “pay a very, very heavy price” if it attempts to assassinate Hamas members in Turkey, as it does not consider them terrorists.

Erdoğan previously compared Israel’s prime minister Benjamin Netanyahu to Adolf Hitler, while Netanyahu hit back, claiming that Erdoğan cannot preach morality as the president is responsible for massacring the Kurds and holds the “world record for imprisoning journalists.”

This latest accusation of Israeli espionage in Turkey has heightened concerns of a greater conflict in the Middle East. Earlier this week, Lebanese prime minister Najib Mikati accused Israel of attempting to drag it into a regional war after Hamas leader Saleh al-Arouri was killed in a drone strike in southern Beirut on Tuesday.

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The founder of collapsed Turkish crypto exchange Thodex, Farouk Fatih Özer, has been sentenced to 11,196 years, 10 months, and 15 days in prison along with his sister Serap Özer and brother Güven Özer, and fined for 135 million liras ($5 million).

The Anatolian 9th Heavy Penal Court announced the verdict on Thursday. Özer was accused of running off to Albania with $2 billion in customer funds when Thodex, one of the largest crypto exchanges in Turkey at the time, suddenly went dark in April 2021.

The Thodex founder was extradited back to Turkey in April 2023. Serap and Güven Özer were also detained, along with at least 83 others. However, the court acquitted 16 of the 21 defendants and released four of seven in jail due to lack of evidence. Several others were given prison sentences for various offences.

Read more: Thodex chief denies fraud, says crypto exchange was hacked

According to the prosecutor’s 22-page opinion, Thodex was established with the intent to deceive and defraud users who wanted to invest in crypto. Farouk Fatih Özer has always denied these allegations.

Özer was found guilty of aggravated fraud, leading a criminal organisation, and money laundering.

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The founder and CEO of Thodex, a Turkish crypto exchange dubbed by politicians as “the biggest fraud case in the history of the [Turkish] Republic,” has denied all charges in his first court appearance and claimed he was framed instead.

Faruk Fatih Özer and 21 other defendants are accused of fraud, money laundering, and running a crime ring. Özer reportedly fled to Albania with $2 billion in user funds back in 2021 and was arrested by local authorities in August 2022. In April this year, the founder was extradited to Turkey.

According to the Istanbul Chief Public Prosecutor’s Office, Özer and his employees could face up to 12,164 to 40,564 years in prison combined. However, the Thodex CEO said in his first court appearance on Monday, “I was framed. I started my company and my company was hacked,” (via local media).

Özer also stressed to prosecutors that he had sole authority in company decisions and added that his sister, Serep Özer, didn’t have de facto authority at Thodex.

Thodex founder denies all charges

When Özer fled Turkey in 2021, supposedly with $2 billion of user funds, Turkish politician and human rights lawyer Sezgin Tanrıkulu described the incident as “the biggest fraud case in the history of the [Turkish] Republic.”

“[Özer] founded a company and turned people’s expectations into a fraud,” Tanrıkulu said at the time.

However, Thodex issued a statement on its website denying the allegations and claimed that it was the victim of a slander campaign. The firm said that Özer had simply left the country to secure partnerships abroad.

The firm’s questionable explanations weren’t enough to stop Interpol from issuing a red notice which ultimately led to Özer’s arrest in Albania. Sixty other Thodex employees were initially arrested, as well.

According to Özer, however, his team shouldn’t be facing trial. “There is no other authorized person in the company besides me. Thodex’s transactions with banks were carried out automatically. I personally checked the transaction made on the company platform to the banks every week in the form of an Excel spreadsheet. I was the only one doing this to ensure there were no security holes,” he explained.

The founder added, “It is a black mark on the legal system that my employees have been imprisoned for two years.”

Seven of the 21 defendants are currently in custody, including Özer.

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The founder and CEO of Thodex, a Turkish crypto exchange that defrauded nearly 400,000 users in what politicians called “the biggest fraud case in the history of the Republic,” was arrested in Turkey this week after two years on the run, reports Anadolu Agency.

In 2021, Faruk Fatih Ozer reportedly shuttered Thodex and fled to Albania with $2 billion of user funds. Chainalysis said earlier this year that the lost crypto was worth $2.6 billion.

Ozer was arrested in Albania on August 30 following an Interpol red notice. His detention and extradition were contested in court but his appeals were quashed and on December 30 his extradition to Turkey was upheld.

He faces charges of fraud, money laundering, and managing a criminal organization.

More than 60 Thodex employees were arrested in the days following Thodex’s collapse and a Turkish Mafia kingpin-turned-YouTuber living in Dubai claimed that Turkish government ministers took bribes from Ozer.  

Read more: Can Turkey’s anti-Bitcoin president find an inflation cure in the metaverse?

The Turkish crypto exchange’s 2021 popularity was spurred on by rising inflation and an unstable Lira. Turks looking for financial security turned to exchanges like Thodex and even the government hoped interest in the metaverse would help save the country’s spiraling currency. Since January 2021, the Lira has fallen by 60%.

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Turkey’s Bitcoin-hating president Recep Tayyip Erdoğan has instructed his party to research blockchain stuff, with a particular focus on the so-called metaverse, reports Crypto Briefing.

Erdoğan recently told officials from his Justice and Development Party (AK Parti) that blockchain is “a delicate matter and should be looked at thoroughly.”

He also wants the lowdown on crypto and social media, with findings discussed in an online forum that he’d attend.

This is quite the turnaround from a man who, just last year, declared “we are in a war against Bitcoin” and banned merchants from accepting crypto as payment.

Erdoğan launched a campaign late last year to encourage buying into Turkey’s floundering lira to avoid a death spiral.

But Turkey’s government has already held its first meeting in cyberspace the metaverse.

Earlier this month, information and communication technology lead Ömer İleri led a virtual get-together during which he said through his crudely-animated avatar (quote via Crypto Briefing):

“As blockchain technology has enabled digital ownership, Turkey has accelerated its metaverse efforts. The metaverse is open to development in virtual reality, product management and innovative business models.”

Metaverse? Turkey turns to Tether to escape plunging lira

İleri isn’t wrong. Despite the country’s “at war” status with Bitcoin, crypto and metaverse concepts have gained traction across Turkey.

Much of this has been attributed to the Turkey’s rapidly devaluing currency. In the past year, Turkey’s inflation rate has soared to more than 30%. The lira has in turn lost 40% since last September.

[Read more: OPINION: The Metaverse and ‘Web 3’ aren’t even here and they’re already cringe]

This has led to rising numbers of Turkish citizens taking their chances with Bitcoin and even meme coin Shiba Inu rather than risk their savings going down with the banks.

Dollar-pegged stablecoin Tether is also a popular proxy for the US dollar, noted the Wall Street Journal, with inflation-wary Turks increasingly trading liras for USDT.

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