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Being the resident writer obsessed with cryptocurrency in this publication (I'm sure there is at least one in every other publication), I can not help but selfishly smile whenever a nation is facing currency problems.
Currency devaluation has been one of the main drivers of bitcoin demand in many countries, based on what I have collected since I plunged into the cryptocurrency rabbit last year.
Reports say the sharp decline in the Turkish lira has fueled the digital currency trade in the country while the Turkish cryptocurrency trade such as Koinim, BtcTurk and Paribu have seen peaks of up to 100% in the trading volume of the Lira-BTC markets this month, based on CoinMarketCap data.
Bitcoin reached a seven-month high against the lira last Monday, rising to TRY44.842 per currency, the highest level since last January, according to CoinGecko.
Given that there is still an end in sight for the volatility of the lira – between rising inflation, the poor economic management by the Turkish government and tensions with the United States – hopefully that the demand for bitcoin continues to rise in the country and, in turn, by the economic law of supply and demand, raise the prices of bitcoin.
In many of these countries hit by the crisis, people had begun to open bitcoin wallets and cryptocurrency exchange accounts to get their hands on the controversial internet money to preserve their investments in devaluation of legal currencies.
While governments may be able to shut down banks during times of crisis, the bitcoin network has been perpetually open since its first transaction – a 10-BTC transfer between developer Hal Finney and the enigma that is Satoshi Nakamoto, the creator of bitcoins – with the exception of occasional network congestion during peak periods.
(Fun fact: the first true- The worldwide transaction with bitcoin was a 10,000-BTC purchase of the software architect Laszlo Hanyecz for two pizzas from Papa John's in May 2010, equivalent to about RM258. 22 million at current prices)
During the Greek crisis of 2015, which saw the government close banks due to a bank run, reports say that there was a surge of Greek registrations to exchange bitcoins on the German market Bitcoin.de.
Bitstamp, the third largest stock exchange in the world at the time, trade volume rose 79% from the 10-week average. Also the trading platforms in China have seen an increase in the volumes of visitors using computers based in Greece.
At the time there was an increase in BTC's prices, but it was not clear whether it was directly linked to the crisis.
In Venezuela, there was an increase in bitcoin extraction against a depreciation of 99.9% in the value of bolivar and rigid currency controls, which cut the supply of currencies such as the US dollar.
In addition, Venezuelans have an advantage in mining as the price of electricity is subsidized, making the country one of the cheapest places to extract bitcoins. The country also markets more bitcoins than China on the LocalBitcoins.com platform, which enables peer-to-peer transactions of cryptocurrencies and local currencies worldwide.
The Venezuelan government also launched its own commodity-backed digital currency last February – the petro – to bypass sanctions and raise funds for the country, even though the US has labeled digital money as a scam.
Similarly in African countries like Sudan and Kenya, the distrust of the people in the government and the lack of conventional banking services have fueled the demand for bitcoins, due to its decentralized nature without any government or central bank behind [19659002] Best-case scenario, the turbulence in the Turkish lira could give a much needed shake to the bitcoin price (it has passed around US $ 6,000 for a while) and I can make a quick profit.
Worst-case scenario, the bitcoin drops to zero and my fingers burn. Of course I will not be alone.
