Cryptoassets, expectation gaps and consumer protection: the case of Türkiye

Levels of interest in; and curiosity about; cryptoassets have been high in many emerging economies. An example is Türkiye; an economy where some investors have used cryptoassets as a hedge against the volatile fiat currency and as an alternative to the traditional investments in gold. Many find that cryptoassets offer transactional ease and that; among cryptoassets; stablecoins can potentially be solid stores of value; yet other aspects of cryptoassets can present dangers; including a lack of understanding of their nature. Many can be led into unwise investments through expectation gaps based on suppositions that the safeguards that apply to other investment opportunities will be present. Others will have expectation gaps based on stories of success for others bringing survivorship bias combined with a fear of missing out. Personal fortunes can be put at risk without any hope of redress. Stablecoins; although regarded as a safe investment; can on closer inspection be found to lack the protections that might be expected. This article builds on a qualitative study in the empirical legal tradition involving Turkish crypto industry professionals and investors which highlighted the potential for expectation gaps in cryptoasset investments. It then considers three expectation gaps in more detail; considering consumer protections in other contexts and building upon a textual analysis of risk disclosures in the terms and conditions of the 10 leading Turkish crypto exchanges and other sources. The article then identifies a model of vulnerability for Turkish consumers arising from expectation gaps and family circumstances and considers possible consumer protection responses; to suggest a pluralistic and decentred regulatory approach to consumer protection; in order that consumer choice is not unduly hampered; and innovative markets can develop.