Posted 2 years ago | by Ben Armstrong
Turkey Adopts Cryptos Amid Declining Lira, Political Instability
Turkey has seen a rough couple of years. It is just north of the war-torn nation of Syria, and has been an active participant in the international conflict that is still raging there. According to Statistica's Global Consumer Survey for 2019, 20% of Turkish residents are familiar with cryptos. That appears to be the highest amount in the world, and the Turkish have every reason to use decentralized currencies.
Although Turkey is a relatively wealthy nation for the region, it has been under fire for years. The exchange value of the Turkish lira has fallen by more than half over the last decade when compared to the US dollar, and its global image was marred by an attempted coup in 2016.
Cryptos like Bitcoin are decentralized, which makes them a good asset for people who need to have the ability to use a digital payment system, and can't rely on their central bank to cooperate with the established, Western financial system. Cryptos make saving and doing business possible, and the Turkish people appear to realize their true value.
No PayPal in Turkey
The Turkish lost the ability to use PayPal when Turkey's Banking Regulation and Supervision Agency denied the online payments mega-platform a license, and forced the Turks into alternative options. More than half of the Turkish respondents to the Global Consumer Survey had used a digital payments platform, which makes a technology like cryptos a much easier sell.
Barış Özistek, who is the chairman of VC fund Boğaziçi Ventures and games publication company Netmarble EMEA, commented to Cointelegraph:
There are more than 30 million active gamers in Turkey. Gaming is a sphere in which virtual equipment and digital currency is used for the first time, and used most commonly...Turkish users already knew that virtual materials increase in value when supply and demand are created in the markets, or depending on their popularity, they may decrease in value. That's why Turkish users adopted to cryptocurrencies very fast and easily. Of course, a high percentage of digitally literate people among Turkish users and being informed about trade in our historical past were contributing factors to the situation.
There doesn't seem to be any sort of push-back from the Turkish government over the rising use of cryptos, and this may have to do with its continued inability to create any sort of lasting confidence in its banking system. Without alternative means of trade settlement, the Turkish economy would suffer more.
A Way Out
In addition to commerce, cryptos act as an insurance policy for savers who have watched their national currencies destroyed. The devaluation in Turkey has been mild when compared to places like Argentina or Venezuela, where the monetary system is on the verge of collapse (in both nations).
Cryptos act as a way for people to have a means of savings and trade that isn't affected by the political or banking system of their nation, and in these uncertain times, that appears the be a big advantage in many nations.