Bitcoin skyrockets in Turkish market as Lira collapses

TL;DR Breakdown

• The price of Bitcoin reached new highs in the Turkish market, despite the correction globally.
• Turkey is currently ongoing a severe economic crisis that is crippling the national currency. 
• Many locals turned to Bitcoin to hedge against the declining value of the currency, hence the spike in BTC price. 

Globally, it can be said that the leading cryptocurrency, Bitcoin (BTC), is still overwhelmed by the bearish market, following the continuous drop in price. At the time of writing, BTC was trading at $45,887 on CoinMarketCap, a nearly five percent decline over the last 24 hours. However, investors in Turkey see a completely different side of this current market condition.

BTC is currently skyrocketing in the Turkish market as many people in the country have turned to the cryptocurrency to hedge against the declining value of the Lira, the nation’s fiat currency. At the time of writing, BTC was trading at 772,913 Lira on Trading View. About two hours ago, BTC reached as high as 795,012 Lira.

Why is Bitcoin soaring in Turkey?

The market value of the Lira has been collapsing for some days now as the country battles economic crisis. The currency lost a significant percentage of its value against the US dollar within a day, and it’s feared that Turkey might face a strong wave of inflation if the situation continues for a longer period. As a result, many locals are increasingly buying Bitcoin in a bid to hedge against the declining value of the currency. 

In November, the CEO of MicroStrategy, Michael Saylor, commented on the economic crisis in Turkey, saying Bitcoin is the hope for the Turkish people. “The currency has lost a third of its value since March and declined for nine consecutive years. Conversion from TRY to USD will merely slow the collapse, while adoption of BTC will reverse the damage & revitalize the economy,” Saylor said. 

The safe-haven

Many people welcome the idea of Bitcoin being a better inflation hedge asset, and it is unarguably one of the major reasons the cryptocurrency is attracted to both retail and institutional investors. Until the situation calms in Turkey, the trading volume in the country might continue to increase significantly, as is the case in other countries like Venezuela, Argentina, etc., which are also battling inflation.