Turkey has for some years been seen as a hotbed for cryptocurrencies, in the face of the catastrophic devaluation of the local currency, the source of runaway inflation. And it would appear that the trend has only been confirmed, according to a recent report from exchange platform KuCoin.
Is cryptocurrency king in Turkey?
Half of Turkey’s population could own cryptocurrencies, according to a recent KuCoin survey. More specifically, the proportion of people who own them has risen from 40% to 52% over the past eighteen months. The KuCoin report is based on a limited sample – 550 people – but it tends to confirm an underlying trend that several sources have noted over the years. Last May, for example, a study indicated that the country topped the list of regions with the highest adoption of cryptocurrencies, alongside Nigeria.
According to the KuCoin survey, 58% of those polled said their main reason for investing was long-term wealth accumulation. 37% explained that it was also to build up a store of value. When it comes to the type of cryptocurrency preferred, Bitcoin (BTC) unsurprisingly comes out on top, with 71% of investors. However, 45% of them own Ether (ETH), as well as stablecoins.
Inflation a big driver for cryptocurrency acquisition
Since the Covid-19 crisis, Turkey has experienced accelerating inflation, and a sharp devaluation of its fiat currency, the lira (TRY). Although the Central Bank raised its key interest rates, inflation rose again in July, reaching almost 48%. In all, the lira has lost half its value in a year and a half:
Faced with this, the Turks have had to find alternatives, and Bitcoin (BTC) and cryptocurrencies have developed particularly well in Turkey. This shows once again that the adoption of crypto assets occurs naturally in territories where the local currency is heavily devalued. As mentioned above, this is particularly the case in Nigeria, where the government’s monetary policy has recently been criticised. So if the Turkish lira continues to nosedive, there’s a good chance that the democratisation of cryptocurrencies will continue in Turkey.