Bitcoin price surge in Turkey and Nigeria has reached all-time highs due to the declining value of their national fiat currencies and economic instability. Despite trading 50% below its peak in US dollars, bitcoin has surged against the Turkish lira and Nigerian naira. Currently, bitcoin is trading at 9.6 million against the lira and 27.4 million against the naira, resulting in monthly gains of up to 30% in local currency terms.
Increased Trading Volume in Local Crypto Exchanges
Local crypto exchanges in Turkey and Nigeria have experienced a significant increase in trading volume, with $40 million worth of bitcoin traded in the past 24 hours. It’s worth noting that this figure may not include locals trading on global exchanges like Binance or Coinbase. The depreciation of the naira and lira against the US dollar has contributed to the increased demand for bitcoin as a perceived alternative to fiat currencies.
Inflation Rates Drive Demand for Bitcoin
According to an IMF study, inflation rates in Nigeria have risen by 25% compared to 2022, while Turkey has experienced a 51% increase. This has led to a decline in the purchasing power of the lira and naira, further driving the demand for bitcoin. Both Turkey and Nigeria have a significant level of crypto adoption, with Nigeria being the second-most active country in terms of users participating in decentralized finance and crypto trading activities.
Anticipation of a Bitcoin ETF Approval in the US
The recent anticipation of a spot bitcoin exchange-traded fund (ETF) approval in the US has also contributed to the excitement among crypto investors. This led to a 20% weekly gain in bitcoin prices and a surge in options activity. However, the price volatility that had been absent for several months returned as bitcoin spiked to $35,000 within hours. This was caused by the discovery of a ticker associated with BlackRock’s proposed bitcoin ETF, leading to irrational exuberance among some investors who believed it to be a sign of approval.
Bitcoin as an Alternative to Fiat Currencies
The Bitcoin price surge in Turkey and Nigeria highlights the growing demand for cryptocurrencies as an alternative to traditional fiat currencies. As the value of the lira and naira continues to decline, more people in these countries are turning to bitcoin as a hedge against inflation and a means to preserve their purchasing power. This trend is likely to continue as long as economic instability and high inflation rates persist in these nations.
Global Impact of Bitcoin Price Surge
The Bitcoin price surge in Turkey and Nigeria is not only significant for these countries but also has implications for the global cryptocurrency market. As more people turn to cryptocurrencies as a means of protecting their wealth, it is likely that the demand for bitcoin and other digital assets will continue to grow. This could lead to further price increases and greater adoption of cryptocurrencies worldwide.
In conclusion, the Bitcoin price surge in Turkey and Nigeria can be attributed to the declining national fiat currencies and unstable economies in these countries. The increased demand for bitcoin as a perceived alternative to fiat currencies has been fueled by the depreciation of the lira and naira. Additionally, the anticipation of a spot bitcoin ETF approval in the US has generated excitement among crypto investors. As long as economic instability and high inflation rates persist, it is likely that the demand for bitcoin and other cryptocurrencies will continue to grow, both in Turkey and Nigeria and globally.
