Is it Possible to Use Crypto Assets as Joint Stock Company Capital?

The acceptability and applicability of crypto assets as capital for joint stock companies is an issue worth discussing. Companies founded on crypto assets bring a different breath to traditional business life with their potential to be used not only in financial transactions but also as capital. So, is it possible to use these new generation assets as capital, especially for joint stock companies? Let’s examine the answer to this question in the light of various legal regulations and financial approaches.

The blockchain technology behind crypto assets allows users to make direct transactions, unlike traditional centralized systems. Blockchain can be defined as a transparent database system where all transactions are recorded and distributed. For example; Transferring or storing digital currencies such as Bitcoin can be done without the need for a central authority. This opens the doors to a new financial model for capital companies. Although Bitcoin is one of the most popular uses of blockchain, systems that enable smart contracts such as Ethereum also offer new solutions in the operational processes of companies. Thus, the use of these assets, which are gradually finding a place in the financial world, as capital in joint stock companies, comes to the fore.

The acceptability of crypto assets as capital in Turkey is associated with regulations such as the Turkish Commercial Code (TTK) and the Capital Markets Law (CERPK). With the regulations issued in 2021, the use of crypto assets as a means of payment is prohibited. However, the definition of crypto assets as digital assets and their acceptance as intangible rights leaves open the possibility that these assets can be used as capital. For example, the definitions such as wallet, crypto asset, crypto asset custody service in the Capital Markets Law show that these assets have a definable value.

The Turkish Commercial Code lists the assets that can be accepted as capital in kind in capital companies. Capital in kind includes movable and immovable assets as well as assets with economic value such as commercial reputation and intellectual property rights. In this context, it is stated that values ​​that can be evaluated in cash, transferred and subject to a property right can be used as capital in joint stock companies. In this context, the fact that crypto assets have the transferability and cash valuation features necessary for them to be considered as capital in kind makes them a part of this process.

The availability of crypto assets as capital in joint-stock companies faces some practical obstacles, despite legal regulations. The first of these is the problem of volatility, that is, the value of crypto assets is constantly changing. Since crypto assets are not as stable as traditional currencies, fluctuations may occur during the valuation process. Although in some countries such as Switzerland, this problem is tried to be overcome with weekly value averages, a clear method has not been determined on this issue in Turkey yet.

Another difficulty is that the crypto asset invested in the capital can be used effectively by the company. The ability to transfer and account for the wallet in which crypto assets are stored on behalf of the company brings a different procedure to the financial structure of joint stock companies. In this context, the company must have the appropriate infrastructure and legal regulations to manage crypto wallets.

Since SerPK defines crypto assets as intangible assets, it is possible to account for these assets. However, there is still a lack of legal basis for trade registry offices to accept crypto assets as capital in kind. Clear regulations are needed to accept crypto assets as capital in kind during the registration process.

Although it seems theoretically possible to place crypto assets in joint stock companies as capital in kind, according to current legal regulations, practical obstacles stand out as the biggest difficulty in implementation. The use of crypto assets as capital seems to be shaped by the approach of trade registry offices and fiscal policies. In this process, more flexible and decisive regulations are needed to adapt to the innovations that crypto assets will bring in the trading world.

The use of crypto assets as capital can contribute to a more integrated legal and financial systems in the future. In this context, the Turkish legal system and companies can lead the transformation of the financial system by effectively addressing the digital economy and the use of blockchain-based assets.