The chief prosecutor's office of Istanbul on July 31 seized crypto exchange Icrypex after raising accusations of money laundering, according to a press release sent out by the authority.

Istanbul-based Icrypex, launched in 2018 by Gokalp Icer, operates one of the biggest cryptocurrency markets in the world. 

Turkey, home to officials with 'interesting' methods

According to the Trade Registry Gazette, Icer holds a 70% stake in the company with 30% held by Semsihan Karaca.

On July 10, Icer acquired a 5% stake held by Umut Senol. The latter was released from jail after turning state witness (becoming a "confessor" as such a person is described in Turkish) in the ongoing Istanbul Municipality investigation.

The acquired shares boosted Icer’s stake in the company to 70%. Karaca, Icer’s partner, is also a board member at Hedef Portfoy Yonetimi (a unit of Hedef Holding (HEDEF).

Turkey's officials are known for their 'interesting', methods. The path that has led to the seizure of Icrypex has taken some curious twists and turns.

Cocaine, Turkey’s new drug

According to media reports, company owner Icer and a 27-year-old woman, a lawyer, on July 14 used cocaine in a villa in Istanbul's Sariyer district. The woman ended up in hospital for reasons that are not clear.

Turkey has become a main cocaine route for international traffickers. At the same time, cocaine has become the most popular drug among the country's rich. There are, of course, exceptions, but the word is that just about anyone who has real money in Turkey uses cocaine.

So the gangs transiting cocaine through Turkey to Europe are also capitalising on a strong Turkish market for the drug.

Is Icer's main 'crime' his backing of CHP journalists?

After the cocaine headlines concerning Icer were published, government media and social media trolls launched a campaign targeting him, since Icrypex sponsors Youtube channels that are run by pro-main opposition Republican People’s Party (CHP) journalists.

Plots and procurement

On July 27, Icer was detained by the prosecutor’s office for the procurement of illegal substances.

On July 28, a court ordered the formal arrest of Icer over a plot that could have allegedly resulted in an attempt at murder as well as for the procurement of unlawful drugs.

On July 29, two days before the seizure of the company, Icrypex announced that Icer’s wife, Zehra Ezgi Icer, who has served as the general manager of Icrypex since 2018, was now also board chair.

Currently, Gokalp Icer has no seat on the board.

Not notified

What is more interesting is that Icrypex said on August 2 that it was yet to be officially notified of the seizure.

However, the company management’s access to its accounts and assets were blocked.

Money behind state's lock and key

As a result, the management still sits in place, claiming it has enough liquidity to meet all money withdrawal requests. But, since it has no access to the company accounts, no one can in fact withdraw their money.

A tool for wealth transfer

Since 2002, Turkey’s government has used deposit insurance fund TMSF as a tool for wealth transfer. As of August 1, TMSF had established management over 827 companies. 

In July 2024, Fatin Rustu Karakas, head of TMSF, said that the fund had seized 1,371 companies over links to the Gulenist clan since the group allegedly orchestrated a military coup attempt against the Erdogan administration on July 15, 2016.

The operation against the Gulenists is neverending.

The Imamoglu wave

In February, TMSF was appointed as a state trustee (note so-called trusteeships result from seizures) over fast food chain Maydanoz Doner in relation to a prosecution aimed at Gulenists.

In March, 23 companies owned by Erkan Kork (including Bankpozitif, Flash TV, fintech companies Payfix, Aypara (iPara) and Ininal) were seized as part of a prosecution aimed at illegal sports betting.

Also in March, Imamoglu Insaat, owned by jailed Istanbul mayor and chief rival to President Recep Tayyip Erdogan, Ekrem Imamoglu, and his family, was seized as part of the ongoing Istanbul Municipality investigation.

Since then, more companies have been seized as part of the operation aimed at Imamoglu and more businessmen have been arrested.

On June 28, government-run news service Anadolu Agency reported that 52 companies had so far been seized and subjected to trustee appointments under the corruption prosecution targeting Imamoglu.

It looks like Icrypex has become the latest target in the Imamoglu crackdown.

Three arms 

The new wave of company seizures launched with Maydanoz in February has seen seizures executed via three arms, namely the Imamoglu operation, an operation aimed at illegal betting and the Gulenist operation.

In July, fortune-telling apps Faladdin and Binnaz were seized. Their case remains an outlier.

Separately, municipalities have been seized.

TMSF, top for fintech

In May, the TMSF also took over the management of local fintech Papara. As a result, currently, the TMSF is the dominant player in Turkey’s fintech industry. It holds two active units in addition to two suspended units.

And now it has a crypto exchange.