Turkish Investors Turn to Cryptocurrency as Lira Crashes

Over the weekend, by several reports, an economic near-disaster struck Turkey as its currency, the lira, plummeted in value against the dollar. With disturbing possibilities of bank collapse emerging, this undoubtedly had investors very nervous. Nervous investors turned not to dollars, pounds, Euros or even gold—some reports suggested that trying to buy into such currencies was rendered difficult if not impossible on some fronts—but rather to cryptocurrency.

Just which cryptocurrency the investors flooded varies depending on circumstances; one report suggested that many common Turks were headed for a small-cap cryptocurrency known as Digibyte, while another noted that bitcoin proved a tempting port in the lira storm. Bitcoin exchanges throughout Turkey reported massive spikes in sales; Koinim, the largest such exchange, saw a 63 percent jump, while BTCTurk saw 35 percent. Paribu, meanwhile, saw its sales double.

This prompted some bitcoin fans to note that bitcoin was now officially “less risky than holding lira,” a point that some less-experienced buffs took with some umbrage. After all, they noted, bitcoin is down 70 percent over this year so far, but given that bitcoin started out about a decade ago in the hundredths-of-a-cent range, bitcoin is actually doing a fairly decent job of holding its value.

Decent indeed; from Turkey to Venezuela and beyond, regular citizens nonplussed about the state of their internal currency are turning instead to cryptocurrency, which does seem to hold its value a lot better than, say, the Zimbabwean dollar did. What’s especially interesting about this is that this seems to be the response of choice for anyone facing large-scale inflation or currency collapse; they start buying bitcoin or dogecoin or whatevercoin in a bid to escape the collapsing local. While governments are quick to clamp down on buying some other country’s fiat, or even gold, cryptocurrency is often flying underneath governments’ collective radar, giving citizens something of an edge.

Will this continue? Will more currencies buckle in the global economy and send citizens fleeing to crypto to preserve some vestige of their wealth? Only time will tell, but based on what we’ve seen so far, cryptocurrency may be the ultimate escape hatch for citizens looking to get out of the way of a collapsed currency.