Turkish lira devalues while people actively buy cryptocurrencies
In 2021, Turkey's economy is facing serious challenges. The inflation rate has passed 20%, and the lira has fallen sharply against all major currencies.
Today, the Turkish lira exchange rate against the U.S. dollar rose again and has almost reached the value of 13 TRY to 1 USD. This is a new historic low. The lira has lost 85% of its value in less than a year.
The cause lies in the short-sighted policy of Turkish President Recep Erdogan. He actually declared an "economic war of independence" against the world market.
Following orders from the Turkish leader, the local Central Bank adopted a policy of aggressive interest rate cuts in order to boost exports, attract investment and increase employment. However, so far, the results have been disappointing.
Overwhelmed by the collapse of the national currency and anticipating an even bigger one, Turkish citizens started to buy cryptocurrencies actively. According to Chainalysis, Turkey climbed to 26th place in the Global Cryptocurrency Adoption Index and firmly holds the leading position among all the countries of the Middle East. Cryptocurrency platform Paxful, offering the purchase of cryptocurrencies for the Turkish lira, has estimated that over the past 12 months, the growth of new users from Turkey has increased by almost 300%.