One of the primary motivations for most investors to enter the cryptocurrency market and invest is to recuperate big earnings. Besides, due to economic situations, other traders are compelled to enter the market. Inflationary conditions force traders to hedge their holdings in the event of a downturn in the economy. Bitcoin is a good inflation hedge since it has performed admirably for those who have previously invested in the asset. The Turkish Lira is currently in freefall as inflation grips the country, creating an opportunity for Bitcoin adoption.
The Turkish Lira is continuing to depreciate against the US dollar
As per several reports, the European country’s economic crisis began after the central bank reduced its borrowing costs. This is the third time the Turkish central bank has pushed the Turkish Lira lower against the dollar in the previous three months. According to a Wall Street Journal story, the central bank reduced a key rate by 1%.
There have been rumors that the measure will lead to pricing stability across the nation. However, as per the latest data, the Turkish Lira is currently trading at 11.311 versus the US dollar, down 6% against the dollar. The latest decline, according to the data, is the largest in the last eight months. With the nation’s inflation rate already above 20%, Turkey’s president, Recep Erdogan, has determined to stick to his vision of ending interest rates in the country.
Michael Saylor recommends inflation-stricken countries accept Bitcoin
Investors have acknowledged Bitcoin worldwide as one of the greatest vehicles for holding money in an inflationary environment. Citizens in countries experiencing similar economic problems share the same outlook. For example, Microstrategy CEO Michael Saylor recently recommended Turkish residents to use Bitcoin in a tweet. Saylor cited the currency’s persistent depreciation against the dollar over the past nine years as the cause for his decision. He believes that if Turkish citizens had Bitcoin instead of dollars, the impacts would be less severe.
In the past, Michael Saylor has emphasized the importance of citizens in weak economies adopting the first digital asset. He points out that Bitcoin holders in these countries will live well from the asset gains. Apart from Turkey, there has been news about Argentina and other Latin American nations struggling with inflation.