President Donald Trump recently increased the tariffs on Turkey’s aluminum and steel exports to the US, which resulted in a decline of over 14% in value of the Turkish lira, the country’s fiat currency, against USD.
As the lira tumbled, the trading volume on some of Turkey’s largest cryptocurrency exchanges, including Btcturk, Koinim, and Paribu. surged by over 100%. Despite the increased trading activity, absolute volumes remain low on most of Turkey’s digital currency exchanges, with the largest local exchange, Btcturk, recording approximately $11.6 million in the last 24-hour period.
Finding Economic Relief In Cryptocurrencies
Looking at these developments, however, particularly the lira plummeting to an all-time low against the USD, it seems Turkey’s residents are losing confidence in their financial system. The country’s economic policies have been criticized, as it is unable to recover from its severe debt crisis.
Meanwhile, Turkish President Recep Tayyip Erdogan issued a warning, stating the US was waging an “economic war” against the nation. Erdogan also told Turkey’s citizens to support the fragile local currency by exchanging their gold, euros, and dollars for Turkish liras.
It appears that, should Turkey’s economic woes continue, its residents could further turn to bitcoin and other cryptocurrencies to find relief. For most of this year, the crypto market has followed a bearish trend, but in countries like Venezuela, where the local economy and currency have completely collapsed, local retailers have started using cryptocurrencies to survive.
Cryptocurrencies in Turkey
According to various reports, Turkey’s residents have revealed new cryptocurrency exchanges open frequently, and that people are increasingly more interested in both buying and using cryptocurrencies like bitcoin.
#Erdogan wants citizens to exchange foreign to local currency while Turkish #Lira is crashing right now. Since 2015 lost more than 50%. The best solution is #Bitcoin and #cryptocurrency market. Don't let them fool you. They can take all money from you but not #BTC #STOCKS #TURKEY— Henri de Valois (@henridevalois) August 11, 2018
Some users have reported using cryptocurrencies because of the Turkish lira’s weaknesses, and because of political and financial turmoil the country has been enduring over the past few years. Cryptocurrencies are known to thrive in times of economic uncertainty, as Venezuela’s crisis saw various cryptocurrency communities, including that of Dash, BCH, and BTC, help residents.
Some of Turkey’s residents have claimed they are losing faith in fiat currencies as a whole. According to CryptoCompare data, the Turkish lira made up 0.07% of BTC’s total trading volume in the last 24-hours.
Notably, as CryptoGlobe reported, Turkey has recently launched its first blockchain research and innovation center.