Bitcoin adoption has been increasing in Turkey as the local currency, the Turkish lira, hit another record low Thursday, reportedly touching 7.95 to the dollar. The dollar has gained about 33% against the lira so far this year and some analysts are predicting that it will soon hit 8.5. “The Turkish lira is getting smoked” and “will crash to new lows due to ‘unorthodox’ policies,” CNBC reported analysts explaining. “The lira’s underlying problem is the lack of credible inflation targeting by the central bank, which is bound to ultimately debase the currency,” Commerzbank analyst Tatha Ghose wrote in a note to clients last week.
The country has been suffering from high inflation and the unemployment rate is past 14%. Steve H. Hanke, Professor of Applied Economics at the Johns Hopkins University and a hyperinflation expert, said Turkey’s annual inflation rate is at 36.57% and climbing. “The lira is toast,” he tweeted Sunday. “Turkey is burning through its foreign exchange reserve like a house on fire,” the professor continued, noting that its reserves currently stand at $41.12 billion, down almost $10 billion since July.