Illusions and inflation – Should the politicians in power really be happy about a containment of the adoption of Bitcoin and cryptocurrencies in their country? Turkey is moving forward with its cryptocurrency regulatory plan, and that’s not necessarily good news for the industry.
Turkey, Bitcoin and crypto regulations: the ball soon in the court of parliamentarians
Turkey’s President Recep Tayyip Erdoğan told a meeting with economists and business leaders held at Dolmabahce Palace thata bill on cryptocurrencies would be ready. This project will be sent “without delay” to the Turkish parliament.
Erdoğan had expressed his anti-crypto stance in September 2021, stating that his administration is at war with cryptocurrencies, – just that – and that she will never support them. Former Turkish Prime Minister Binali Yıldırım, meanwhile, called investing in Bitcoin and cryptocurrencies “the sale of a fictitious future,” stressing the need to regulate them strictly.
Erdoğan had displayed his hostility against cryptocurrencies while declaring that “we will move forward with our own currency which has its own identity”. The Turkish Central Bank has embarked on the race to develop its own digital currency. A simple digitization – a change in form and not in substance – will the Turkish lira be enough to help fiat money to keep ahead in the face of inflation ?
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The War on Cryptocurrencies: Finding a (Good) Inflation Diversion
One-year inflation in Turkey reached a rate of 21.31% in November 2021. In parallel, on November 20, 2021, bitcoin (BTC) crosses the 800,000 Turkish lira mark for the first time, as the fiat currency collapses against the US dollar after Erdoğan recommits to a fall in interest rates.
Is making life difficult for cryptocurrencies the right solution to the economic crisis in Turkey? This war against cryptocurrencies is above all akin to a diversion to try to make the general public forget that inflation is actually the result of the failure of the traditional economic, monetary and financial system, and that cryptocurrencies and the decentralized foundation on which they are based, could represent a better alternative.
Will this new regulation cause a new wave of departure of crypto companies from the country, like Binance which had nevertheless established in 2020, a partnership with one of the largest banks in Turkey ?
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