Amid fears of rising inflation in the United States due to the ongoing bank crisis, Argentina and Turkey, have experienced high inflation first.
Reporting from Investmentmonitor.ai, in January 2023, the inflation rate in Turkey reached 57.7%. This means that the price of goods that previously sold for 100 Turkish lira in January 2022, will now have to be paid for 157.7 lira.
Meanwhile, Argentina experienced hyperinflation. In January 2023, prices for goods increased by 98.8% compared to January 2022.
The problem of inflation in Argentina has been faced for several years. During the Covid-19 pandemic, inflation increased to 50% in 2019, while in 2016 it reached 40%.
Adoption of Bitcoin (BTC) Amid Inflation
In the midst of this inflation, the adoption rate of Bitcoin in the two countries is actually quite good.
Based on the report Chainanalysis: Global Crypto Adoption Index 2022 shows Turkey and Argentina are in the middle position among the 20 countries with the highest adoption of crypto, at 13th and 14th respectively.
The price of BTC against the Argentine PESO has also strengthened 20% in the past year, although the price of BTC posted a 34% decline against the US dollar during the same period.
Meanwhile, Turkish people are increasingly converting Lira into USD or gold as the currency has lost 90% of its value since 2008. According to a Cryptopotato report, Bitcoin and Tether have been the most popular trades against the Lira over the last three years.
Reuters also reports, amid inflation between March 20-24 2021, when the lira plunged 10% following the dismissal of the central bank governor, 23 billion lira worth of crypto was traded. Meanwhile, in December 2021 alone, one million crypto assets were traded in Turkey.
However, you need to pay attention, inflation is not the only factor that increases crypto adoption, there are other factors such as regulation, technology, ease of transaction, and so on.