Key Points
- The Middle East & North Africa (MENA) region ranks as the 7th largest crypto market globally, with $338.7 billion in on-chain value received between July 2023 and June 2024.
- Regulatory progress in key markets like the UAE and Saudi Arabia is driving adoption, with decentralized finance (DeFi) gaining traction alongside traditional centralized exchanges.
In a comprehensive analysis of cryptocurrency adoption and trends, blockchain analytics firm Chainalysis has highlighted the Middle East and North Africa (MENA) as an increasingly significant player in the global crypto landscape. The report, an excerpt from their 2024 Geography of Cryptocurrency Report, reveals that MENA accounts for 7.5% of the world’s total transaction volume, solidifying its position as a rising star in the crypto economy.
UAE Leads with Progressive Regulation and Diverse Ecosystem
The United Arab Emirates (UAE) stands out as a beacon of crypto innovation within the region. Between July 2023 and June 2024, the UAE received over $30 billion in crypto transactions, placing it among the top 40 countries globally. Unlike many other markets, the UAE is experiencing growth across all transaction size brackets, indicating a balanced adoption landscape.
The report credits this success to the country’s proactive regulatory approach. The establishment of the Virtual Assets Regulatory Authority (VARA) in Dubai has been particularly influential, attracting global attention and setting precedents for other jurisdictions. Deepa Raja Carbon, Managing Director and Vice Chairperson of VARA, emphasized the collaborative nature of their regulatory efforts, stating, “Both the industry and regulators come to the table with that perspective — to learn together and evolve.”
Turkey Emerges as Stablecoin Hub Amidst Economic Challenges
Turkey has emerged as the largest crypto market in MENA and the seventh globally, with $136.8 billion in value received during the reported period. The country’s high inflation rate, which has hovered around 50% for the past year, has driven citizens to seek refuge in cryptocurrencies, particularly stablecoins.
Francisco Maroto, Head of Blockchain at BBVA, noted that an estimated 40% to 50% of Turkey’s population is engaged in crypto. This high adoption rate is linked to the need for consumer financial protection amidst ongoing inflation. The country ranks first globally in stablecoin trading volume as a percentage of GDP, highlighting the critical role these digital assets play in Türkiye’s economic landscape.
Saudi Arabia and Qatar: The Region’s Fastest Growing Crypto Economies
The report identifies Saudi Arabia and Qatar as the fastest-growing crypto economies in the MENA region, with year-over-year growth rates of 154% and 120%, respectively. Saudi Arabia’s focus on blockchain innovation, central bank digital currencies (CBDCs), gaming, and fintech has attracted traditional financial institutions like Rothschild and Goldman Sachs to set up operations in Riyadh.
Qatar’s growth is supported by the recent launch of a new digital assets regime by the Qatar Financial Centre (QFC), which establishes legal and regulatory foundations for digital assets and asset tokenization. This development is expected to accelerate fintech innovation and contribute to the country’s digital transformation journey.
As the MENA region continues to embrace cryptocurrencies and blockchain technology, the report suggests that regulatory clarity will be crucial in fostering innovation, providing stability for businesses, and attracting investors. With its unique blend of economic drivers, regulatory progress, and technological adoption, MENA is poised to play an increasingly important role in shaping the future of the global crypto ecosystem.
