In Turkey, Bitcoin and cryptocurrencies are enjoying great interest and steady growth. This is on the one hand due to the interest of the Turks in the topic but above all also due to the weak Turkish Lira. The Bitcoin course could reach now in Turkey a new all time high, measured in Lira. In this article we look at the background and why such a phenomenon can occur locally at all.
Bitcoin Course in Lira at All Time High
The Bitcoin price measured in Turkish lira is currently at 84,536 TRY. However, the Bitcoin price reached a new all-time high of 84,000 TRY four days ago and has already risen to 85,000 TRY today. From these strong rises, one can see how bad the Turkish national currency is. The strong slump of the world economy has also left its mark on Turkey and especially the tourism industry has been hit hard by the Corona Pandemic.
Because the value of the Lira continues to fall, the Bitcoin price automatically increases, because BTC is a very hard money compared to the Lira. If money is described as particularly hard, there is also talk of a special value stability. The harder it is to increase the amount of money in circulation, the harder the money is.
The Turkish government and central bank are trying to support the country’s currency by buying up dollars, but this has only been successful to a limited extent. While the deposit by gold has been reduced more and more, the Turkish central bank tries to compensate for the fall of the Turkish Lira by massive purchases of US currency.
In addition, the high demand for BTC is another reason for the immense rise of the Bitcoin price in Turkish Lira. If you look at it from the other side, you can say that Bitcoin simply remains stable compared to the Turkish Lira and the Lira is worth less and less BTC or Satoshis.
Bitcoin Course on a high note: TRY / BTC
At the moment you get one Bitcoin for 84.826 TRY, which is still no reason for many Turks not to invest in the cryptocurrencies no. 1. The high Bitcoin exchange rate simply reflects the immense weakness of the Lira and that without manipulated or embellished state exchange rates. Often the state exchange rates are significantly lower than the rates actually traded on the local markets.
The Turkish Lira is also losing value against the Euro. While in 2018, 4.5 Turkish Lira were still being obtained for one Euro, today one already receives 8.5 Lira for it.
Turkey is a Bitcoin country
The Turkish authorities are a thorn in the side of not only Bitcoin but also other harder currencies such as the US dollar or the euro. The Turkish people are trying to protect themselves from the currency inflation that has been advancing for several years by investing in gold and Bitcoin.
Many crypto exchanges like Binance and Huobi are currently expanding very strongly in Turkey to meet the needs and demand. Binance has already established many partnerships with payment service providers, but also gold shops and kiosks. So Turks can easily buy Bitcoin and cryptocurrencies in small shops through Binance.
The high Bitcoin price and the increasing demand for Bitcoin is due to the high inflation rate. According to the statistics shown, this was even over 16 percent in 2018 and has now fallen slightly to 12 percent. All owners of Turkish lira have therefore lost 27% of their purchasing power in the last two years alone. However, the Corona Pandemic will cause this to rise again, as can already be seen from the Bitcoin exchange rate.
Conclusion: Turks need Bitcoin as protection
The Turkish lira is still on the downhill slide, despite the great efforts of the monetary authorities, and it is doubtful that this will change. Apart from the problems of the currency itself, there are also political tensions in Turkey. The intervention in the Syrian war and the attempted coup in 2016 is unsettling the population and is also scaring off foreign investors.
The economy is weakening and the lira can hardly escape the downward spiral. In addition, relations with the USA have also deteriorated under Donald Trump, which is exerting further pressure on the ailing economy.
In October 2019, the Turkish authorities blocked almost 3.3 million bank accounts because social security repayments were outstanding. This shows how rigorously far-reaching steps such as confiscation or blocking are being taken. After PayPal was banned in 2016, Bitcoin is a good way for more and more Turks to send money. Whether from Germany to Turkey, the other way around or within the country itself, a Bitcoin transaction cannot be stopped.
Bitcoin is immune to confiscation and is also a very good way to store assets outside inflation and government control. Bitcoin cannot be banned and gives the people of Turkey back responsibility and control over their property.