Abstract Cryptocurrencies (Crypto Assets”) have more than 3,500 variants in total which have made their mark on the world recently and are the first decentralised securities in the world. The crypto asset is often used as an umbrella term and it includes Altcoins and Tokens. The most important features of Crypto Assets that differ from the traditional money concept are that the prices are not determined by any central authority, they are of the same value everywhere, they are based on blockchain technology, they are value for money and are not under the control of any central authority. Especially in the last period, access to technology has increased due to the developments in technology and also global pandemics caused an increase in the use of technology and internet. Accordingly, access to crypto assets has become much easier and the circulation of crypto assets has increased explicitly.

Upon the integration of technological developments into capital markets, crypto assets have also taken their place in business life and bringing these assets to companies as capital has become a subject of curiosity as a result of developments in trade and technology and expanding stock markets. In this article, respectively; following subjects will be examined: Crypto assets and the brief history of crypto assets, Assets that can be brought as capital to joint-stock companies, and The issue of bringing crypto assets as capital to joint-stock companies.

1. Cryptocurrencies

The global crises experienced in the history of the world have led to the reconsideration of a centralised money concept. Money Confidence Indexes published every year shows that people’ strust in the banking system and the governments that are supposed to regulate the financial markets have declined significantly with the crises experienced. However, the money continued to be under the control of the central authority for a long time. Eventually “Bitcoin” aimed to change the system when it emerged, but it was not easy to accept Bitcoin as a currency in the new system. Because it is not possible to talk about the proper conditions for the crypto assets. However, the infrastructure for cryptoasset services in many financial environments, especially banks, mobile applications and money machines is developing rapidly. The fate of cryptocurrencies, which combines their strengths and weaknesses compared to fiat money, remains uncertain. Since the authority behind the fiat money is not included in crypto assets, it will leave the actors alone in the losses and losses to be experienced, so these crypto-assets are approached by many quite hesitantly.

Basically, money acts as a medium of exchange. According to the doctrine, what is used in exchange for goods and services is considered money. When the occurrence of money is examined, it will be understood that its purpose of existence is to facilitate exchange. However, over time, the type of money has changed in parallel with the changing needs. In other words, money is not only a means of exchange but also started to be used for different purposes over time. For example, money sometimes fulfilled different functions such as investment instruments, sometimes supplied as collateral or used as a unit of measurement. In this direction, crypto assets have attracted the attention of large masses and settled in the focus of many market actors, since they are virtual assets that have the same value everywhere, are based on blockchain technology, have value for money and are not under the control of

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F1 a central authority. As a matter of fact, in the 2022 report of Thomson Reuters named “Crypto Asset Regulations by Country”, it is stated that the interest shown in crypto assets is high all over the world and especially in Turkey. In support, towards the end of 2020, the US-based online payment system PayPal announced that it would accept cryptocurrencies as a means of payment, and as a result, interest in crypto assets increased.

The value of crypto assets is determined by the buyer and the seller by transactions that take place on virtual platforms. As it is known, the transfer of crypto assets takes place with blockchain technology. This is what enables crypto assets to operate independently of a

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central authority. Traditional monetary systems are under the control of governments, central banks, and federal states’ financial elements, respectively. Transparency in transactions involving crypto assets is more evident than in conventional money concepts. Because the transactions are based on the “block-chain” technology. This technology eliminates thirdparty intermediaries that help legitimise the transaction in transactions between parties. Because each of the transactions is recorded in separate blocks on the network in an indelible and unplayable way. On the other hand, the working principle of crypto assets is based on encryption. Therefore, the identity of the wallet owners and transferring parties cannot be determined

2. Assets That Can Be Brought as Capital to Joint Stock Companies

Capital, in the broad sense, is defined as the money used in this business and all the goods that can be converted into money, which are necessary for the realisation and execution of a commercial enterprise. According to article 127 of the Turkish Commercial Code; money, receivables, valuable papers and shares of capital companies, intellectual property rights, movables and all kinds of immovable, movable and immovable rights of use and use, personal labour, commercial reputation, commercial enterprises, rightfully used transferable electronic media, fields, names and Values such as signs, mining licences and other rights with economic value, all kinds of transferable and cash value can be brought as capital to the companies. The count of these values is not limiting (numerus clausus)

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in the provision. As a rule, it can be stated that, unless there is a contrary provision in the law, everything that has economic value and is transferable to another person can be brought to commercial companies as capital. In terms of the values that can be brought in as capital, the provisions of Article 307 of the Turkish Commercial Code for limited companies, Article 342 of the Turkish Commercial Code for joint-stock companies and Article 581 of the Turkish Commercial Code for limited liability companies should be taken into consideration.

3. Incorporation of Joint Stock Companies

through Contributions Consisting of Cryptocurrencies Upon the integration of technological developments into capital markets, crypto assets have also taken their place in business life. However, what is the capital value of crypto assets? In Article 127 of the Turkish Commercial Code, the values that can be brought to commercial companies as capital are listed in an exemplary manner. Unless there is a contrary provision in the law, it is possible as a rule that everything with economic value and transferable to others can be brought to commercial companies as capital in kind. Capital is the element that contributes to the formation of the company and ensures that the person who brings it is a part of the company. Capital is divided into three groups in terms of type: cash capital, capital in kind, labour and intellectual capital. If the capital can be brought in money, it is said to be cash capital. The money stipulated in Article 127 of the Turkish Commercial Code is fiat currency. It can be thought that crypto-assets can be considered fiat currency within the meaning of Article 127 of the Turkish Commercial Code. However, for this, it is important that the fluctuations in exchange rates of cryptocurrencies are not too high and that they have a certain exchange value. The fluctuations experienced make it difficult to determine the values of crypto assets. There are several reasons causing these fluctuations: lack of liquidity, uncertainty regarding regulatory processes, the possibility of security breaches, etc. In this direction, it would be more appropriate to evaluate each crypto asset in its way. Currently, it is not technically possible to bring crypto-assets as cash capital, since cash payments cannot be made with crypto assets. When the time comes when crypto assets will be treated the same as fiat currencies and banks start accepting payments with crypto assets, crypto assets with these qualities will be able to be brought to companies as cash capital.

On the other hand, under the Article 342 of the Turkish Commercial Code, with the title “asset elements that can be invested in-kind capital” in joint-stock companies stating: “asset elements, including intellectual property rights and virtual environments, that do not have limited real rights, liens and measures, that can be evaluated and transferred in cash, are in kind, can be used as capital. Acts of service, personal labour, commercial reputation and unpaid receivables cannot be capital.” Atthis point, crypto-assets cannot be considered as acts of service, personal effort and commercial reputation. Also, these conditions stipulated in terms of capital in-kind are related to the proper establishment of the company by protecting the capital of the company, ensuring the continuity of the company and therefore protecting the company, company partners and creditors. In this way, it is possible to bring crypto assets, which can be considered assets, as in-kind capital to joint-stock and limited companies. Because, evaluation in cash means that the in-kind values brought can be converted into a common unit of measurement, that is, they can be expressed in money/cash. It is not necessary to transfer the ownership of the value brought as capital to the company. The important thing is that the economic benefit expressed by the value brought can be used by the company. In this case, the transferability condition will be fulfilled and therefore, crypto assets can be transferred to the company or can be retransferred. This view is also supported by the French Council of State, which qualified cryptocurrencies as contributions in kind in a decision dated April 26, 2018. (Decision of Conseil d’Etat: https://www.actu-juridique. fr/ affaires/le-conseil-detat-precise-la-naturejuridique-et-les-modalites-dimpositiondu-bitcoin/#: ~: text=Dans%20sa %20 d%C3%A9cision%20du%2026,cession%20 par%20des%20particuliers14. )

Moreover, the method of bringing capital is important as well. As is known, the capital is brought to the company with the articles of association in Turkish Law. This is also the case with the contribution of crypto assets as capital. Since crypto-assets brought to companies as capital are considered as capital in-kind their value in Turkish Lira corresponding to their amount and the number of shares corresponding to this value should be written in the articles of association. Before that, the Turkish Lira value corresponding to the crypto assets brought to the companies as capital should be determined. The value of crypto assets in joint-stock and limited companies will be determined by experts appointed by the commercial court of the first instance in the place where the company headquarters is located. In the prepared report, the valuation method, the number of shares to be allocated in return for cryptoassets and their Turkish Lira equivalent should be written. At this point, Belgian Law has different regulation. The company fonders temselves are required to prepare a report, not through an expert appointed by the court. The underlying reason for this idea is that it is the fonders of the companies who can be held jointly and severally liable to third parties for any harmful consequences resulting from price fluctuations. In addition, another report should be prepared by an auditor on the valuation made by the fonders and the valuation methods used. If the report confirms an incorrect valuation by the fonders, the responsibility of the auditor may be established.

4. Conclusion

As a result, crypto assets are in greater demand and the use of these assets is increasing day by day. It is possible to bring crypto assets with an asset value to trading companies and especially joint-stock companies as capital in-kind since these assets can be evaluated in cash. Because the important thing is that the economic benefit expressed by the value brought can be used by the company. However, since there is no payment feature with crypto assets in our country, it is not possible to bring these assets as cash capital. This is a common practice in the world. Once the necessary regulations and the development of the payment feature occurs, crypto assets with the necessary qualifications listed in the law will be able to be brought as cash capital in the future.

REFERENCES

  • Nina Methens & Pierre Vanholsbeke, Bitcoin and Cryptocurrencies: Can a Company Be Incorporated through Contributions Consisting of Cryptocurrencies?
  • Fatih Bilgili & M. Fatih Cengil, Bitcoin Özelinde Kripto Paraların Ticaret Şirketlerine Sermaye Olarak Getirilmesi
  • Gökhan Ünalan, Kripto Paraların Vergilendirilmesi
  • Thomson Reuters, Cryptocurrency Regulations by Countries
  • Beyhan Yaslıdağ, Kripto Paralar