This is Turkish lira. It has lost 44% of its price vs USD since the beginning of the year.
Together with the inflation hitting 20% and unsustainable level of debt, it has been ruining the livelihoods of Turkish people for many months now.
Decidedly, banning crypto payments in April out of fear that they “may undermine the confidence in methods and instruments used currently in payments” (cf. Turkish Central Bank) did not save lira from this spectacular fall.
The confidence in a payment method cannot be built by banning its alternatives, and the confidence in a currency cannot be created artificially. And yet this simple evidence is ignored by central bankers of most countries with failing currencies, who try all sorts of bans and restrictions, and Turkey is no exception.
Since April most crypto exchanges closed shop, but Bitcoin price in lira keeps going up on those still in business, even if in the absence of a proper regulation they present risks (earlier this year one crypto exchanges closed in an exit scam, CEO still at large). Bitcoin price is up +217% in lira since the beginning of the year, while it’s “only” +100% vs USD.
Economic journals slam Mr Erdogan for his very strange interest rates policy (while a traditional method of strengthening a currency would be rising rates, he did just the opposite), but we would like to note how cruel it was to deny the Turks a very real alternative to lira, which is proving itself as an inflation hedge all over the world – cryptocurrencies.
In September he said “We are at war with crypto”. For the sake of the Turkish people, he should find another adversary, for fighting windmills instead of tackling real economic problems won’t improve noone’s life.