Turkey has a new decree adding cryptocurrency exchanges to a list of those investment firms that are covered by Turkey’s terror financing and money laundering regulations. According to an article in the Business Standard, adding cryptocurrency to Turkey terror funding regulations came after Turkey launched investigations into accusations of fraud by Thodex and Vebitcoin, two cryptocurrency exchanges.

This decree makes it easier for “the financial watchdog to investigate digital-currency holdings.” Turkey has been skeptical of cryptocurrency. The country also has a ban on using cryptocurrencies for making payments, citing the risk involved with the transactions as the reason behind such a ban.

The Thodex investigation began, according to Business standard, following complaints from customers who were unable to access their funds. There were 83 arrests originally. The attraction in Turkey to Bitcoin comes at a time with the decline of the value if the lira and double-digit inflation happening there.

Turkey’s government is planning to create a central custodian bank to eliminate the risk involved with cryptocurrency so that they can accommodate those wishing to invest in it. The crackdown, according to Andrew Wilks, came too late. Both Thodex and Vebitcoin collapsed, and investors lost their savings.

So while terrorism wasn’t necessarily behind the reasons for adding cryptocurrency exchanges to their terror funding regulations, protecting Turkey’s investors does seem to be at the crux of making such a decree.

Such a decree raises two issues: first, should exchanges be responsible for ensuring their investors are not illegally using assets and second, should investing exchanges be chartered by the government?

The first seems problematic – on the surface, sure, ensuring investors are on the up and up with the use of their assets seems to be a good idea. However, this can lead to more problems. Namely, if an organization has many investors, tracking how they use their investments may become a fool’s errand. It may be easier to do with Bitcoin since every transaction is logged in the public domain but it’s still a daunting task, even if the exchange has the human power to follow-up on it.

Perhaps having a central exchange is a good idea, as it could ensure that individuals do not have their savings wiped out by scandalous behavior on the part of the company they are using to invest their funds and it could also address the problematic nature of requiring investment firms to ensure that funds are not used for illegal activities.

The problematic part of that is having all of the nations crypto eggs in one basket, so to speak, and the fact that the funds would be managed by a country that has skyrocketing inflation and that does not see cryptocurrencies, particularly Bitcoin, in a positive light.