Turkish lira nosedives as government arrests Istanbul Mayor Ekrem Imamoglu, triggering Bitcoin (BTC) trading volume spike

The Turkish lira slid sharply on Wednesday after President Recep Tayyip Erdoğan’s government arrested his main political rival, Istanbul Mayor Ekrem Imamoglu

The Turkish lira fell sharply on Wednesday after President Recep Tayyip Erdoğan's government arrested Istanbul Mayor Ekrem Imamoglu, a main political rival, setting the stage for a sell-off in the currency.

The lira dropped as much as 12% to 41 per U.S. dollar before recouping some losses, to trade at around 39 per dollar, still a record low.

The instability in the lira also spurred a rush to crypto, with Turkish citizens scrambling to exchange lira for Bitcoin (BTC).

Bitcoin/Turkish Lira Pair Hits Record Volume

In the crypto sphere, the Bitcoin pair against the Turkish lira (BTC/TRY) on Binance saw a huge surge in volume as the crisis unfolded.

According to TradingView data, in a span of one hour, 93 BTC changed hands—the highest hourly volume in at least a year.

While the demand for Bitcoin soared, the lira's freefall also created some distortions in the market.

BTC was trading at a deep discount on Binance's TRY pair compared to Coinbase prices, which suggests that traders were using Bitcoin as a bridge to move money into U.S. dollar-pegged stablecoins like USDT to protect their savings.

Crypto a Haven in Unstable Economies

Generally, cryptocurrencies have increasingly become a refuge in times of financial instability.

Although Bitcoin's volatility makes it an imperfect hedge against inflation, its accessibility and liquidity make it a preferred option in crises.

Stablecoins, in particular, have emerged as a more reliable store of value for individuals and even governments facing currency devaluation.

Some countries have explored backing their fiat currencies with crypto, while others have considered launching state-backed digital assets.

For now, in Turkey, the latest market reaction highlights the growing role of crypto as a financial escape route—one that traders and everyday citizens are using to navigate the economic uncertainty in the country.