Bitcoin Purchases Grow Popular in Turkey as Lira Falls

 In Bitcoin, Exchanges

The latest currency crisis with the floating exchange rate of the Turkish Lira underlined the advantages of crypto assets as a store of value.

Crypto assets are volatile – but in some cases, their value could be more stable than national currencies. Beyond the dramatic examples of Venezuela and Iran, where currency depreciation was extreme, Turkey is yet another country where the performance of crypto assets has somewhat mitigated cryptocurrency risk.

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The Turkish crypto community is one of the most active, as seen by performance and statistics on the Steemit platform, a crypto-fueled social network. Turkey also has 19 Bitcoin full nodes, not too many considering the size of the country, but still speaking of the presence of a Bitcoin community. Mining is also profitable, due to a relatively low price of electricity.

One short-term indicator for an interest in Bitcoin purchases is the activity of LocalBitcoins, which picked up in June and July, just as the Lira was starting to slide against the US dollar.

Turkey, riled by political and even religious conflict, is also a country with very few limitations against cryptocurrencies. There are hardly any attempts at restricting either trading, or ICO projects. Granted, there are only a few crypto startups originating from Turkey, but there is no restriction on launching or using altcoins.

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On the downside, Turkey has seen its citizens blacklisted based on their passports, when attempting to complete the KYC procedure. Along with Syrian and Iranian passports, Turkish ones were targeted and accounts were frozen more often.

By coincidence, recent monetary policy statistics by UBS revealed that the current market capitalization of Bitcoin, at $112 billion, is close to the total value of the M1 money supply for the Turkish economy. This means that at a price around $8,000, BTC could easily substitute the country’s entire money supply. In the past few days, the fallout of the Turkish Lira has caused a game to compare the drop in BTC prices with the loss of value for the Turkish economy.

The enthusiasm for crypto coins in Turkey has also opened up the ground for scams. Outside the tight-knit Turkish crypto community and the few startups, the general public has been targeted by fraudulent projects, including Turcoin, which turned out to be a Ponzi scheme.

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Just as the Turkish Lira was reeling, the Turcoin project continued to unravel, as the news of the scam was widely circulated among the Turkish community on Twitter. The Turcoin project was targeting potential buyers outside social media, leading to losses as high as $211 million, by the estimation of the Turkish press.

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Turkey is also one of the countries for which a national cryptocurrency was suggested – although not Turcoin, for sure.

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