Turkish Lira Falls on Ban of Bitcoin Payments

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After weeks of strengthening, the Turkish Lira (TRY) has dropped by close to 1% today from 8 TRY to the dollar to 8.06. This coincides with a surprise diktat by Turkey’s central bank newly appointed governor, Şahap Kavcıoğlu (pictured left), who ordered a ban on bitcoin’s use for commercial payments. Why this move was taken remains very unclear, with some suggesting it is due to high inflation in Turkey. However, when bitcoin is used for commercial payments that usually means it is insta-converted to Lira from the merchants. Therefore such use should strengthen the lira. Hence perhaps the above chart where we see a gradual strengthening of the lira against the dollar, until today. As can be seen by the highlighted green candle above, the dollar jumped against Turkish lira this morning, reversing at least for now its gradual strengthening. The reason is probably because this decision can affect commerce…

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