Why Bitcoin Hit All-Time Highs in Türkiye, Egypt, Nigeria, and Argentina

Bitcoin has performed strongly recently, once again setting new historical highs in many countries, proving its value as an inflation hedge and a means of storing value.

However, despite the impressive performance, Bitcoin's price relative to the U.S. dollar is still 39% below its all-time high set in November 2021.

On the other hand, Bitcoin continues to hit new all-time highs in Argentina, Turkey, Egypt, Nigeria, Lebanon, and Pakistan. According to a post by X social platform user Tahini on December 13, a single Bitcoin hit an all-time high of 15,176,100.12 ARS against the Argentine Peso sometime on December 12. BTC is worth 1,202,109.40 Turkish Lira (TRY), 32,703,517.06 Nigerian Naira (NGN), and 1,280,955.47 Egyptian Pound (EGP).

The chart also shows that BTC has hit all-time highs against the Lebanese Pound and the Pakistani Rupee, reaching 622,548,74.67 Lebanese Pounds and 11,736,063.26 Pakistani Rupee, respectively.

It is worth mentioning that these figures are equivalent to the current price of Bitcoin, and the surge in cryptocurrencies in these countries is due to high inflationary pressures that have led to the depreciation of their respective currencies.

The International Monetary Fund (IMF) data ranks countries by annual percentage change in inflation and end-of-period consumer prices.

According to the chart above, the Zimbabwean dollar currently tops the list with an annual inflation rate of 396%, followed by the Venezuelan bolivar (250%), Sudanese pound (238%) and Argentine peso (135%). According to the International Monetary Fund, the Turkish lira and Nigerian naira rank fifth and twelfth with annual inflation rates of 64% and 30% respectively.

For many cryptocurrency investors in these countries, Bitcoin has become a reliable store of value and a safe haven against high inflation. Many countries, including Nigeria and Argentina, have actively embraced cryptocurrencies despite the continued depreciation of their national currencies. According to a report by Chainalysis on September 12, Nigeria, Turkey, and Argentina are the countries with the second, twelfth, and fifteenth highest cryptocurrency adoption rates in the world. Bitcoin adoption in Argentina is expected to grow further with the victory of pro-Bitcoin candidate Javier Milei in the November 19 presidential election runoff. After taking office on December 10, Milei appointed Luis Caputo as Minister of Economy, who announced on December 12 that Argentina would devalue the peso by more than 50% to 800 pesos per dollar as an "emergency package" aimed at balancing the budget by 2024. The move appears to have been endorsed by the International Monetary Fund. The IMF called the measures "bold," adding that they would "substantially improve public finances in a way that protects the most vulnerable in society and strengthens the exchange rate regime." During the campaign, Milei had said that he would abolish Argentina's central bank if he was elected president.

Bitcoin outperforms tech companies

Bitcoin has continued to fall along with technology stocks during the long bear market in 2022. According to a comment letter from Pantera Capital, a US cryptocurrency hedge fund, Bitcoin has outperformed all other funds except Meta, which has a year-to-date increase of more than 172%, while BTC has increased by 162%.

Pantera said Bitcoin rebounded in 2023 due to the “overwhelmingly good news” of “significant events” and “meaningful, necessary progress in the blockchain industry.”

The crypto hedge firm listed a number of such events, including increased institutional adoption, thanks to “spot Bitcoin ETFs sponsored by big names in traditional finance such as BlackRock and Fidelity, as well as Bitwise, a leader in blockchain ETFs.” The potential approval of a Bitcoin exchange-traded fund opens up a new channel for traditional capital to infuse Bitcoin as “digital gold.”

The letter also states that the market’s ability to rely on the fairness of the U.S. court system has been “reassuring,” citing Judge Analisa Torres’ ruling that XRP is not a security and Grayscale’s victory in its lawsuit against the SEC over its BTC ETF application. The report states that these all indicate that the U.S. cryptocurrency regulatory environment is favorable, allowing further innovation to occur domestically.

In addition to this, the upcoming Bitcoin halving event in 2024 has also fueled general optimism about the flagship cryptocurrency.