Turkey has been quietly digitizing itself despite the economy going through high inflation- along with the volatility of the lira which could correlate with Bitcoin. During the last quarter of 2021, the TRY/USD exchange rate went on to crash from 9 to 18.5 liras per dollar in the six weeks which led up to mid-December before it strengthened itself to as high as 10 liras- then falling back to 13.87 liras at the time it was reported.
Turkey Has Paved The Way For Digitization
The volatility of the Lira does seem to stem from a very contrarian interest rate which has been made by the President of Turkey, Recep Tayyip Erdogan- which comes amidst high inflation and against the advice provided by central bankers.
High inflation usually tends to devalue drive and cash investors- which include major institutional and professional investors alongside some of the major top hedge fund managers like George Soros- which would allow the investing of money in cryptocurrencies. With the rate of inflation soaring above 20%, the news editor at Cointelegraph, Erhan Kahraman, stated that Bitcoin usage in the country has gone up elevenfold.
This is why it was quite unexpected when the entire market for cryptocurrency went on to crash during the first week of trading in 2022, as a result of which Bitcoin and Ether- which rose 100% and 300% during 2021 respectively- entered the bear market territory. The crash was then blamed on a combination of three events- one which could definitely impact Turkey.
One of the reasons for the crash could be the anti-government riots in Kazakhstan, the second-largest Bitcoin mining hub in the world, which led to the government of the country being sacked and several internet services being shut down- something that would lead to the production of cryptocurrency in Turkey falling under the zone of resistance.
