On May 31, 2016, PayPal announced it would suspend all payment services in Turkey starting June 6 after failing to secure an operating license from the local regulatory authority, BDDK (Banking Regulation and Supervision Agency). In a statement on its Turkish website, the company said it had encountered rejections of its license applications and had to comply with instructions to cease activities in the country.
“PayPal’s priority has always been customers. However, we encountered local regulatory agency rejections of our license applications and therefore have to apply the relevant steps in accordance with the instruction to stop our activities in Turkey, a decision we regret to make,” the statement read. PayPal noted it would continue working on the licensing issue while its platform remains non-operational.
Turks Show Strong Pro-Bitcoin Sentiment
PayPal’s withdrawal comes at a pivotal moment for Turkey. In contrast to many nations, the Turkish government has been broadly open to Bitcoin and digital currencies. A 2015 survey by ING revealed that 45% of Turkish respondents believe “digital currencies – such as Bitcoin – are the future of spending online,” the highest percentage among all countries polled. Another 28% were undecided, while only 27% disagreed. For comparison, in the Netherlands – often seen as a European hub for Bitcoin – only 9% agreed, with 57% disagreeing.
The survey also noted that Turkish usage of payment apps stood at 56%, comfortably higher than any other participating country. About half of Turks were aware of Bitcoin, though awareness remained relatively low.
Bitcoin Could Fill the Void
PayPal’s sudden exit creates a vacuum that may accelerate cryptocurrency adoption in Turkey. Consumers and merchants seeking alternative payment methods may turn to Bitcoin due to its decentralized nature and low barriers. Following the announcement, a user petitioned eBay via Twitter to add Bitcoin as a payment option. “We cannot use PayPal from Turkey anymore. Do you think add bitcoin etc payment option? We want to see any solutions,” wrote one user.
Industry observers believe this development could be a catalyst for Bitcoin adoption in Turkey, as the absence of a major traditional payment gateway forces users to explore alternatives. With the government’s relatively friendly stance, Turkey may become a fertile ground for digital currency growth.