Turkish Crypto Exchange Under Investigation After Abrupt Shut Down, User Funds ‘Irretrievable’

With about 390,000 active users affected, the senior economic adviser to the President calls for the Turkish government to take action and “carry out a regulation.”

An investigation has been launched into a Turkish cryptocurrency exchange Thodex after the platform became inaccessible on Wednesday. The exchange abruptly halted trading, citing unspecified partnership transactions.

The Public Prosecutor's Office in Istanbul appealed to the personnel for their testimonies on the platform, after users who can't access their digital assets complained to the authorities, reported the state-run Anadolu Agency.

The website of the exchange is inaccessible, displaying a “404 Not Found” message.

Operating since 2017, Thodex advertises itself as Turkey's first licensed crypto exchange and has 14.8k followers on Twitter.

In an undated statement on the website, the exchange said it decided to allow outside investment to serve its customers better adding, services will remain shut for five working days while the transfer is completed, but users need not be worried about their investments.

Unable to withdraw their funds, users of the exchange have now filed a complaint alleging fraud.

“We’ve filed a legal complaint on Wednesday,” Oguz Evren Kilic, who represents an unspecified number of Thodex users, told Bloomberg. According to him, hundreds of millions of dollars worth of assets of about 390,000 active users is “irretrievable.”

The founder and CEO of the exchange Faruk Fatih Ozer allegedly fled the country on Wednesday. Demiroren News Agency said Ozer’s gone to Albania, based on a photo which it said is of Ozer at the airport.

The Turkish government should take action “as soon as possible,” Cemil Ertem, senior economic adviser to President Recep Tayyip Erdogan, told Bloomberg on Thursday.

“Pyramid schemes are being established in this area. Turkey will undoubtedly carry out a regulation that’s in line with its economy but also by following global developments.”

About a week back, Turkey’s central bank banned the use of cryptos as a form of payment from April 30, citing possible “irreparable” damage and transaction risks.

Amidst this, the search for bitcoin, crypto, altcoins, DeFi, and NFT on Google in the country have surged to all-time highs as Turks seek investments to hedge against the depreciating fiat currency and high inflation.

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