Turkey’s only reprieve in a time when its economy is spiraling at an alarming rate is Bitcoin. Max Keiser, a huge supporter of Bitcoin, is of the view that Bitcoin and Turkey should start getting cozy before it’s too late.
In a Tweet, Keiser noted:
“Bitcoin will become a factor for Turks as hard money becomes hard to come by.”
Although Keiser is a Bitcoin bull, his sentiments are backed by facts. The country’s fiat currency, the Turkish Lira, is now among the leading top five government-backed currencies used in Bitcoin trades. Notably, the Turkish Lira only falls behind the Japanese yen, the US dollar, the euro, and the South Korean won in no specific order.
Before it sinks, let’s get lifesavers
This could be a sign that Turks are not waiting for the boat to completely sink for them to start looking for lifesavers. In mid-April, the Lira had already succumbed to a six-months low when pitted against the United States dollar.
Unfortunately, the fall is projected to get even more significant in the wake of an extended election period. And the election mood is yet to scale down anytime soon seeing that the Istanbul vote needs to be held again. But the election is just one reason why Bitcoin and Turkey should start dating.
However, even if a new election is held, “At this stage, whatever the result of the re-vote, the impression has been left that the election process in Turkey is not secure,” noted Timothy Ash, strategist, Bluebay Asset Management.
The central bank’s help is not enough
Efforts by the country’s central bank to rescue the country’s economy has turned futile further cementing the Bitcoin and Turkey upcoming relationship. For Turks who are yet to hop onto the Bitcoin train, the US dollar and the euro have been more appealing than the Turkish Lira
The inflation levels in the country have also started climbing. For instance, last month, April 2019, the annual inflation rate stood at 19.50 percent, which was viewed as an improvement since it was at 19.71 in March.
A look at Turkey’s inflation rate since mid-2018 projects a worrying trend. For example, in July 2018, the inflation rate stood at 15.85 percent which was an increase seeing that is was at 12.15 percent a month before. From July, the inflation kept rising to reach a height of 25.24 percent in October and started decreasing and was at 20.35 percent by the end of January 2019.
An increase in the inflation rate is expected to hurt Turkey’s job market, which is already feeling the pinch. The unemployment rate is currently at 14.7 percent.
It’s a combination of factors
As noted by CNBC:
“The causes were many and varied: Investors lost faith in [president] Erdogan’s will to allow central bank independence, Turkey’s current account deficit kept widening and inflation skyrocketed, Turkish businesses struggled under mounting foreign-denominated debt and Washington threatened sanctions over diplomatic crises.”
With the current economic situation projected to get worse, and the price of Bitcoin increasing each day, it’s time for Bitcoin and Turkey to know each other. Better.