As the middle eastern country continues to battle inflation and economic failure, it has unleashed its enforcement wrath on the nation’s crypto sector in a bid to contain its remaining wealth.
Turkey’s fiat currency, the Turkish lira, has lost value and severely depreciated in the face of the nation’s current economic crisis.
Turkey’s Financial Crisis
The middle eastern country has since 2018 been facing a financial crisis. Ruling president, President Recep Tayyip Erdoğan’s regime has seen the nation’s economic sector fail miserably. Ranging from high inflation rates to massive debt, the issues plaguing the Turkish economy continuously cropped up until it qualitatively crippled the economy.
Before the decline of the nation’s economy, it had enjoyed a booming success under the previous leader regime, which saw the nation leverage the growth of its construction sector locally and internationally. However, Its fiat currency, the lira, has now collapsed ultimately compared to the pre-2018 regime as President Erdoğan’s plan to revamp the economy backfired seriously.
President Erdoğan’s pilot economic policy fielded unorthodox ideas that sought to leverage low-interest rates to boost the nation’s economic growth and improve its fiat currency’s value. The plans, at the time, seemed visionary and, if successful, will leave Turkey with sustainable socio-economic development.
Unfortunately, the plan failed catastrophically; it backfired seriously. The failure affected in a snowball manner; it started with the gradual depreciation of its currency, to the increase in cooperates debts up till the collapse of the entire framework.
The inflation rate in the country is now at double digits percentage, and its total debt stands at approximately 146.38 billion U.S. dollars.
Turkey’s Clampdown On Cryptocurrency
Following the nation’s traditional finance sector failure, citizens of turkey have turned to the crypto sector to make their daily bread.
Earlier this year in March, Blockworks tracking protocols have reported that Google searches for Bitcoin and cryptocurrencies in the country increased by over 500%. The increasing attention that Turks showed the industry immediately caught the government’s attention.
Shortly after Blockworks’ march report, the country outrightly banned the usage of cryptocurrencies as a payment option in its borders. Acquisition and ownership as at them remained legal.
However, regulatory bodies in the country consider the digital assets class as a means to evade taxes and capital control. The government has exponentially increased enforcement actions in a bid to contain and preserve its wealth as the lira continues to depreciate.
Crypto Market Remains Stable Despite Regulations Storm
Days sourced from on-chain analytics protocols gathered from turkey has indicated that the country’s crypto market is stable and hasn’t seen any extreme fluctuations due to Erdoğan’s upcoming bills. Traders that trade the fiat currency pegged stable coin pairs seemingly don’t intend to dump their lot in the marketspace before crypto exchanges activities shut down in the country.
Trading volume in the crypto market space continues to hold steady, according to stats by Coingecko metrics. The top leading Turkish crypto exchange platform BTCTurkPro has recorded an average daily trade volume of $300 million. Crypto trading volume spiked to $1 billion on December 21 following President Erdoğan’s announcement regarding crypto that saw the fiat currency lira gain a significant price value.