The Turkish lira (TRY) has fallen to a record low against the dollar amid increasing political tensions, marked by the unexpected arrest of President Recep Tayyip Erdogan’s rival, Istanbul Mayor Ekrem Imamoglu. The currency experienced a dramatic decline of nearly 41 to the U.S. dollar, marking a staggering 10% drop within a single day.
This upheaval has triggered significant volatility in the financial markets, as evidenced by a notable surge in trading volumes of the bitcoin-lira (BTC/TRY) pair on the prominent cryptocurrency exchange, Binance.
Imamoglu’s political party, the Republican People’s Party (CHP), has characterized the arrest as a coup aimed at undermining the will of the electorate. With a primary election scheduled for next week, Imamoglu was widely anticipated to be the leading candidate for the presidency.
Between 7:00 UTC and 8:00 UTC, Binance reported a transaction volume of 93 BTC in the BTC/TRY pair, an unprecedented figure for the past year according to data compiled by TradingView. However, despite the heightened activity, Bitcoin was trading at a significant discount compared to prices listed on Coinbase (COIN) when adjusted for the lira’s exchange rate.
Market experts suggest that traders may be offloading BTC/TRY positions to reposition into dollar-linked assets such as Tether (USDT), the leading stablecoin. CoinDesk has reached out to Binance for further insights on the ongoing trading behaviors.
Volatility in fiat currency is a recurring theme in Turkey. Over the years, it has significantly intensified the appetite for hard assets like gold, as well as alternative financial instruments such as stablecoins and cryptocurrencies. The lira has been on a relentless depreciation trajectory since at least 2017, when its value was recorded at 3.53 to the dollar.
