Over the past weeks, the Turkish cryptocurrency market has recorded increased trading volume and utility of digital assets across its exchanges. This comes as a direct reaction to the plummeting at an all-time low of the European nation’s currency the (Turkish LIRA) against the US Dollar.
This trend is given further validation with recent statistics showing Turkey’s lead over other European nations as almost 20% of Turks own virtual currencies. Also reports from the country’s top exchanges Btcturk, Paribu and Koinim all show over a 100% gains ; with an attendant increase in their respective customer base.
From economic analysis, the decline of the Lira is an aftermath of Turkey’s chaotic relations with the United States which soured further after the US President Donald Trump tweeted his cabinet’s decision to double import taxes for Turkish steel and aluminium by 50% and 20% respectively; as the Lira headed downward against the dollar amidst both nation’s tensed political relations.
The Lira is said to have shed over 45% against the dollar in 2018 alone with some economic experts pointing fingers at the nation’s refusal to increase interest rates on the currency as a factor; while others specifically blame the dollar for this massive decline with respect to the US Federal Reserve’s quantitative easing policy which they say has increased the dollar’s potency against other fiat. This argument by the latter further corroborates finance author Robert Kiyosaki’s prediction of an imminent financial crisis caused by US policies on its fiat currency (US dollar).
As these financial woes continue with the Lira and while exchanges enjoy astronomical gains, it looks increasingly deducible that Turkish nationals may continue to flock to cryptocurrency as a worthy antidote to an impending financial crisis; with institutional investors and the public poised to cryptocurrencies even in the wake of the current crypto bear market.
Turkish President Recep Tayyip Erdogan in a statement had called on Turks to step forward and exchange other stores of value (Euros, Dollars, Gold) in their possession to the Lira in the face of this “economic war” with the United States as he quotes
“This is a domestic and national struggle. We are running a current account deficit, high level of private sector debts and inflation.”
However, efforts have been made by the Turkish central bank to salvage this situation and return sanity to the Lira.
In all, the aftermath of this crisis still seems unpredictable as it is left to be seen if investors and the Turkish public are in for a long term parley with cryptocurrencies or a short term safe haven while they await an unpredictable revival of the Lira. For most experts, this downturn further depicts that Bitcoin and cryptocurrencies offer a value that stands firm against the US dollar and gives the people power over the political tensions which affect the economy.