The Turkish financial turmoil is headed for a second week after we saw the local currency of the Lira, drop by 25% in the past month. Majority of this decline was witnessed within a span of 24 hours as can be seen in the chart below.
On the 9th of August, the Turkish Lira went from trading at 0.18452 to the USD, to levels of 0.15142 in a matter of 24 hours. This is a decline in value of 18%. This drop has been blamed on increased U.S sanctions and a new constitutional order that concentrates power in the hands of President Erdogan. To stem the continual decline of the Lira, the central bank, finance ministry and the nation’s Banking Regulation and Supervision Agency, have put in measures limiting the amount of foreign currency and Lira swaps. This only leaves the citizens with one other avenue to hedge against the turmoil: cryptocurrencies.
XRP being used to Hedge Against a Declining Lira
Twitter user @C3_Nik was quick to notice that one of Turkey’s crypto exchange, Sistemcoin, has suddenly climbed up the ranks in terms of the volume of XRP it is trading in a day. In the tweet, he stated the following:
Citizens of Turkey are indeed exchanging lira into XRP and other crypto assets as a safe haven: The exchange Sistemcoin is on place 16 out of 177 in terms of trading volume in
#xrp which is quite remarkable!
The tweet was accompanied by the following screenshot showcasing the rankings of exchanges that are dealing with XRP trading and Sistemkoin is ranked 16th with a daily volume of XRP that is equivalent to $2.844 Million. It also shows other exchanges dealing with XRP paired with the Lira and how they are fairing in terms of ranking.
Could XRP End Up Being a Global Currency?
XRP definitely has the volume- in terms of coins in circulation – to sustain global demand. The circulating supply stands at 39.299 Billion XRP and the total supply stands at 99.99 Billion XRP. Comparing this figures with the USD, there is currently $1.67 Trillion in circulation globally. To cover this demand, each XRP would have to be valued at around $42 which is highly a possibility (using the circulating supply figures of both assets).
There is also the added benefit that the Ripple company has partnered with over 50 global central banks. This would further the cause of XRP being a global currency in the future.