Turkey amps up crypto integration to achieve economic independence from the US
In an attempt to stimulate the local economy independently, Turkey turns to a variety of initiatives aimed at integrating and adopting cryptocurrency
As the economy in Turkey continues to struggle, the development and adoption of crypto alternatives is on the rise. Increased tension with the US, distrust among investors and Turkey’s dwindling financial reserves have led the Lira (TRY) to plummet down to its lowest level in history this year.
To save the economy from recession, the country has dramatically increased their investment into cryptocurrencies and blockchain technology to swerve the economy away from recession. This move is accompanied with massive support; more than two-thirds of the country declare that they are positive about adopting cryptocurrencies, with recently introduced crypto debit cards proving a popular use-case in the country.
Apart from experimenting with the idea of a Central Bank Digital Currency (CBDC), Turkey is investing in blockchain research. These programs are meant to encourage the local youth to study blockchain technology and support tech-based businesses. In the long-term, it is hoped these efforts will support the Turkish economy — as the reliance on outside experts will be gone.
In addition, more than 30% of Turkey remains unbanked. Cryptocurrencies can assist in fostering financial inclusion, especially for states in the East; where dangerous conflict prevents banks from setting up in a physical office.
Jonathan Leong, CEO of BTSE, explained how the political and economic situation led the citizens of Turkey to adopt cryptocurrencies:
“Turkey’s political situation and volatile exchange rate has led Turkish people to become the leading adopters of cryptocurrencies, because crypto enables easy access to wealth, borderless payments and reliable hedges against inflation. Crypto debit card adoption is a logical evolution of economic instability and the digital asset space.” said Leong.
Emre Aksoy, an advisor to Turkish Government bodies on crypto adoption and regulation, also noted that over three to four percent of the country’s GDP is being spent on transaction costs and banking intermediaries, adding:
“Cryptocurrency technology will cut these costs and reduce our reliance and dependency on other nations. Turkey now has a real shot at saving its economy.”
Turkey has a median age of 31.5 years, making it a relatively young population. The likelihood of adopting new technologies is therefore possibly higher in Turkey compared to most of Europe. In addition, more than 90% of adults have a smartphone with the country home to more than 50 million mobile internet users.
When ING Bank hosted a survey in 2018, results showed that 18% of the population already owned some sort of cryptocurrency, with another 25% interested in purchasing.