Evaluating the potential effects of digital money on the Turkish economy, Head of the Computer Engineering Department Prof. Dr. Burhan Pektaş said, “Turkey should introduce the digital lira, which could be an important component of its digital economy strategy.”
Prof. Dr. Burhan Pektaş: “Digital currency can integrate Turkey more closely with global digital economies, facilitating cross-border transactions.”
Head of the Computer Engineering Department at Üsküdar University Faculty of Engineering and Natural Sciences (MDBF), Prof. Dr. Burhan Pektaş, evaluated the advantages, disadvantages, and potential effects of transitioning to digital currency on the country's economy.
What are the advantages of digital currency?
Stating that digital currency is a new application rapidly entering our lives, Prof. Dr. Burhan Pektaş emphasized that there are significant advantages and some risks for businesses transitioning to digital payment systems.
Prof. Dr. Burhan Pektaş listed the advantages of transitioning to digital currency as follows:
“Digital currency allows for easy, fast, and contactless transactions, enhancing the user experience. It reduces costs associated with physical cash, such as printing, distribution, and handling. Furthermore, digital transactions are traceable, reducing fraud, money laundering, and other illegal activities. It provides access to financial services for individuals without bank accounts or with insufficient banking access through mobile phones and internet access. It speeds up transactions, reduces payment times, and can increase overall economic productivity.”
Elderly populations or those without access to digital devices may find it difficult to adapt
Providing information on the disadvantages of transitioning to digital currency, Prof. Dr. Burhan Pektaş continued:
“Digital currency transactions can be tracked, leading to concerns about data privacy and surveillance. Hacking targeting digital wallets and payment systems increases the risk of digital theft and cyberattacks. It requires a robust digital infrastructure, which may not be available or reliable in all regions. Moreover, internet access disruptions, power outages, or system failures can halt transactions. Elderly populations or those without access to digital devices may find it difficult to adapt.”
Effects of digital currency usage…
Prof. Dr. Burhan Pektaş also pointed to the effects of digital currency use, stating, “It can reshape how businesses operate with the increase in e-commerce and the reduction in cash processing costs. Central banks may have more control over the money supply, which can facilitate the implementation of monetary policy. As digital wallets and financial technology solutions come to the forefront, it may lead to a decrease in reliance on traditional banking services.”
What are the security risks of digital currency?
Prof. Dr. Burhan Pektaş stated, “Digital currency has security risks from many different angles, such as cyberattacks, data breaches, fraud, and technical vulnerabilities,” and continued as follows:
“We can summarize these as follows. Digital payment systems and wallets are vulnerable to hacking, phishing, and malware attacks. Personal and financial data can be compromised, leading to identity theft and financial losses. This increases the risk of unauthorized transactions and fraudulent use of digital currencies. Errors and flaws in the software of digital platforms can be exploited by malicious individuals. There are some measures businesses can take against these situations. We can briefly list them as follows: Implementing strong encryption, multi-factor authentication, and regular security updates. Training staff to recognize phishing attempts and other common cyber threats. Regularly conducting security audits and risk assessments to identify and mitigate vulnerabilities. Using secure data storage solutions and ensuring compliance with data protection regulations. Additionally, businesses may consider obtaining cyber insurance to protect against potential financial losses arising from cyber incidents.”
What are the potential effects of digital currency on Turkey's economy?
Prof. Dr. Burhan Pektaş also evaluated the potential effects of digital currency on Turkey's economy as follows:
“Digital currency can increase economic participation by providing financial access to underserved regions in Turkey. It facilitates online transactions, potentially boosting e-commerce and digital businesses. Digital transactions are easier to track, which can reduce the size of the informal economy and increase tax revenues. The Central Bank of Turkey may have more precise control over the money supply, improving economic stability. A national digital currency could help stabilize the Turkish lira by reducing dependence on foreign digital currencies.”
How might digital currency usage evolve in Turkey?
Prof. Dr. Burhan Pektaş also pointed to predictions on this topic, concluding his remarks by saying, “Turkey should introduce the digital lira, which could be an important component of its digital economy strategy. As digital infrastructure improves and smartphone penetration increases, more businesses and consumers are likely to adopt digital payments. The financial technology (fintech) sector can be expected to expand by offering more innovative financial solutions adapted to digital currency. More comprehensive regulations around digital currencies and payment systems can be expected to ensure security, consumer protection, and financial stability. Digital currency can facilitate cross-border transactions by integrating Turkey more closely with global digital economies.”