The lira has crashed 40% since September! Turks are piling into cryptocurrencies

The rapid inflation of Turkey's legal currency, the lira, under President Recep Tayyip Erdogan's heavy-handed hand, has sent turks fleeing into cryptocurrencies. According to the Wall Street Journal, lira/USDT trading reached $1.8 billion a day on the three major exchanges last fall, a far cry from the overall $71 billion lira, but still far better than in the past five quarters.

as previously reported, in lira surging inflation, the President refused to respond to the investors about tightening, called for more said monetary policy is an independent economic war, trying to give up to reduce inflation rates and the strong exchange rate on the basis of the old monetary policy, to give priority to increase investment and strong exports and create jobs, So let the interest rates fall and the lira plummet." The Wall Street Journal notes that Turks are used to holding dollars, euros or gold to store their wealth, but the lira has lost 40% of its value against the dollar since Last September. Bitcoin (BTC) rallied 40% against the dollar in early November (around its all-time high) (it's down over 10% now), but cryptocurrency is clearly a better bet than the falling lira.

"Turkish cryptocurrency exchange Bitlo said:" The volatility of the Turkish lira and the rise in inflation seen in recent months has led our investors to view cryptocurrencies as a long-term, profitable investment option while using them as a hedge against inflation in the short term." In Turkey's capital, Istanbul, crypto exchange ads are popping up on trams, billboards and airports, shops selling bitcoin are popping up in alleyways, and foreign currencies and gold are still being snapped up. Ege Tuluay, a 24-year-old student and frequent trader at cryptocurrency store Caspicoin, uses US dollars to buy USDT and plans to buy other cryptocurrencies. "Cryptocurrencies give Turkish people hope," he says of cryptocurrencies. "They're broke, so they want to make money." For Turks, it seems like a good money maker." The Wall Street Journal said some Turks had already converted foreign currencies held in banks, such as dollars and euros, into stable dollars. In December alone, more than half of lira transactions involved USDT, according to Chainalysis. Two-thirds of bank deposits in Turkey are in foreign currency (mainly euros and dollars), so why don't Turks just buy dollars? The Wall Street Journal notes that Turkish banks lend foreign currency to the central bank and the government, which use the funds to intervene in the currency markets to maintain the lira's value (though that policy has now all but been blocked by the president). If Turks are eager to withdraw their dollar assets, the banks will have to withdraw the dollars lent, but many Turks are worried that the government will not be willing to release dollars fully or quickly for reasons of position, and will more likely force banks to pay depositors in lira, so many Turks will buy the USDT instead.