The price of Bitcoin (BTC) has reached new all-time highs against several inflationary fiat currencies. This development occurred over a span of 30 hours from October 23 to 24. Bitcoin’s price surged against currencies such as the Argentine peso (ARS), Nigerian naira (NGN), Turkish lira (TRY), Laotian kip (LAK), and the Egyptian pound (EGT).
This increase in Bitcoin’s value can be attributed to the ongoing devaluation of these currencies, compounded by a 16% rise in Bitcoin’s price. The Nigerian naira and Turkish lira hit their lowest points against the U.S. dollar on October 24 and 25. Additionally, the Argentine peso is only 0.85% away from its all-time low against the U.S. dollar.
International Monetary Fund (IMF) data reveals that the Venezuelan bolivar currently has the highest annual inflation rate at 360%. It is followed by the Zimbabwean dollar (314%), Sudanese pound (256%), and the Argentine peso (122%). The Turkish lira and Nigerian naira have the sixth and 15th highest annual inflation rates, respectively, at 51% and 25%, according to the IMF.
These figures further reinforce the belief held by crypto observers that digital assets like Bitcoin and stablecoins serve as a hedge against soaring inflation. Nigeria, Turkey, and Argentina are among the nations with the second, 12th, and 15th highest rates of cryptocurrency adoption in the world, according to a Chainalysis report from September 2023.
However, it is worth noting that the governments of these countries have not always been favorable towards the cryptocurrency industry. In Nigeria, for instance, the central bank banned local banks from providing services to cryptocurrency exchanges in February 2021. Nevertheless, progress was made in December 2022 when Nigeria announced its intention to pass a bill recognizing cryptocurrencies as “capital for investment.”
Similarly, Turkey, home to numerous crypto enthusiasts, restricted cryptocurrency payments for goods and services in April 2021. The country has also been working on digitalizing the Turkish lira by developing a central bank digital currency (CBDC) in recent years.
Argentina is currently experiencing an inflation crisis, which could be influenced by the outcome of its upcoming presidential election in November. A final run-off vote between presidential candidate Javier Milei and competitor Sergio Massa is scheduled for November 19. Massa, Argentina’s minister of economy, advocates for launching a CBDC as a solution to the country’s persistent inflation crisis. Milei, on the other hand, advocates for the adoption of the U.S. dollar and the abolition of Argentina’s central bank.
Bitcoin’s surge against these inflationary fiat currencies highlights its appeal as a viable alternative to traditional currencies in countries plagued by high inflation rates. As cryptocurrency adoption continues to grow, it will be interesting to observe how governments across the globe respond to the increasing influence of digital assets on their economies.