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December 9, 2022
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Inflation in Turkey makes citizens use cryptocurrencies more

Inflation in Turkey rose to 36% as the Lira lost 44% of its value to the US Dollar

High inflation in Turkey, leads citizens to invest in cryptocurrencies

In recent times, one of the biggest economic crises that countries around the world have been facing is inflation; especially as several of them are having to fight the dwindling purchasing power of their national fiat currency due to the effect of the coronavirus pandemic.

Turkey is struggling with an economic crisis

One country fighting this battle is the Republic of Turkey, where current indications show that the country’s inflation rates have risen to over 30%, an all-time high. according to one Reuters report, consumer prices soared to 13.58% at the end of the previous year.

According to information obtained from Turkey’s Institute of Statistics on Monday, the country’s inflation rates have surpassed 36%, showing the depth of the economic crisis the country is currently in. In addition, the country’s native fiat currency, Lira, lost 44% of its value against the US dollar in the past year.

Because of these rising inflation rates, the country’s benchmark bank has repeatedly had to lower the interest rate benchmark. In fact, the Bank even cut interest rates in December when the country’s Lira dropped to a new low of 15.5% against the US dollar.

Notably, Turkey’s inflation was attributed to a number of factors such as the cost of transportation, drinks and food, as well as household items that grew beyond previous years.

Turkish citizens crypto flock

Due to this level of inflation, the country’s citizens have been migrating to digital crypto assets as the demand for Bitcoin and other Digital Tokens has increased enormously in the previous year.

According Cryptocompare data, TRY represents 0.69% and 0.72% of all Bitcoin trades and Ethereum swaps, respectively. While it looks impressive, it represents only a fraction of the demand for Stablecoins among citizens. As of January 3, 2022, the highest trading pair involving USDT was with the Turkish Lira, at 29.42%.

Other countries with similar problems

While Turkey struggles with an economic crisis, other countries like Argentina, Venezuela and Nigeria are also facing similar problems with their own national currencies.

According reported by Cryptoslate, the cryptocurrency adoption rate in Argentina, soared after Vitalik Buterin’s visit to the country. In addition, Nigerians are one of the biggest users of digital assets in the world, as many citizens highlight the dwindling value of their national currency.

All of this has contributed enormously to the rise in cryptocurrency adoption across the world over the past year.

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