The Middle East and North Africa (MENA) region is rapidly becoming a strong player in the global cryptocurrency market. By 2024, MENA has secured the seventh-largest spot in the world, with a total on-chain value of $338.7 billion received between July 2023 and June 2024. This makes up 7.5 percent of the world’s entire transaction volume in the cryptocurrency space.
Although it still trails behind some larger regions, the growth of cryptocurrency in MENA suggests that big changes are coming soon. Countries like Türkiye and Morocco are at the forefront, with Türkiye ranking 11th and Morocco 27th globally for crypto adoption.
Türkiye and Morocco: Leading the Charge
Türkiye is the biggest player in the region, generating an impressive $137 billion in cryptocurrency value. Morocco, while smaller, also contributes significantly with $12.7 billion in value. This growth is largely driven by institutional and professional transactions, meaning big companies and experienced investors are heavily involved in the market. About 93 percent of value transfers in MENA involve amounts over $10,000, showing that serious investments are being made.
Banks and other traditional financial institutions in the region are beginning to explore their role in the cryptocurrency ecosystem. This interest is growing as new regulations emerge in various countries. These evolving regulations make it easier for these institutions to participate in the crypto market. As a result, traditional financial entities are increasingly looking for ways to integrate with cryptocurrency. This shift marks a significant change in the relationship between traditional finance and digital assets.
Centralised exchanges (CEXs) are the most common platforms for buying and selling cryptocurrency in the MENA region. People primarily use these exchanges for their trading activities. However, interest in decentralised finance (DeFi) is on the rise. This trend is particularly noticeable in countries like Saudi Arabia and the United Arab Emirates (UAE). As more users explore DeFi, the landscape of cryptocurrency trading is beginning to evolve. DeFi allows people to use financial services like loans, savings, and trading without needing traditional banks or intermediaries. This is all done through decentralised platforms, often referred to as decentralised exchanges (DEXs).
DeFi’s Impact in Saudi Arabia and UAE
In Saudi Arabia, the push towards DeFi is largely driven by the country’s young population. About 63 percent of the population is under the age of 30, and this tech-savvy group is more open to trying out new financial technologies like cryptocurrency. This makes Saudi Arabia a prime location for DeFi and other digital financial innovations to flourish.
Meanwhile, the UAE is also embracing DeFi, with the country adopting this technology at a rate higher than the global average. The country’s regulatory framework has played a key role in making this happen, allowing a good balance between government oversight and the needs of the cryptocurrency industry. The UAE has even created a special government body, the Virtual Assets Regulatory Authority (VARA), to oversee crypto activities. Over the last year, more than a thousand companies involved in crypto-related work have been identified within Dubai, and the government is now working to license these entities.
Türkiye and Qatar primarily rely on centralised exchanges (CEXs) for their cryptocurrency activities. They have not fully embraced decentralised finance (DeFi) yet. However, recent regulatory changes in Qatar indicate that DeFi could gain traction soon. Qatar introduced a new digital assets law in 2024 through the Qatar Financial Centre. This law establishes rules for digital assets and tokenisation, paving the way for more fintech innovation in the country.
Stablecoins and Altcoins in the MENA Market
Another important aspect of MENA’s growing cryptocurrency market is the rise of stablecoins and altcoins. Stablecoins are digital currencies that are tied to real-world assets, like the US dollar, to keep their value stable. This is particularly important in countries like Türkiye, where economic instability and high inflation have led many people to look for more stable ways to store their money. In fact, Türkiye is now number one in the world for stablecoin trading volume as a percentage of its gross domestic product (GDP). This shows how important stablecoins have become to Turkish investors.
The UAE is experiencing a rising interest in stablecoins. These stablecoins are becoming a popular entry point for newcomers to cryptocurrency. Meanwhile, countries like Israel and Saudi Arabia are focusing more on altcoins. Altcoins are alternatives to well-known cryptocurrencies such as Bitcoin and Ethereum. This shift reflects the evolving interests of investors in the region. This reflects a growing appetite for risk among investors who want to diversify their crypto portfolios.
In Israel, the government recently completed a successful experiment involving the use of blockchain technology to issue bonds. This is part of a larger global trend towards tokenised assets, which experts predict could be worth as much as $4 trillion by 2030.
In the UAE, the cryptocurrency market received over $30 billion in value between July 2023 and June 2024. The country’s crypto activities cover transactions of all sizes, showing that it has a balanced and healthy ecosystem. Over the past year, the value received by DeFi services in the UAE increased by 74 percent, and activity on decentralised exchanges alone grew by 87 percent.
DeFi and Stablecoins: Unlocking Financial Inclusion in MENA
The rise of DeFi and stablecoins in the MENA region is providing new opportunities for financial inclusion. Many people in MENA, especially in countries where less than half of the adult population has a bank account, can now access financial services without needing traditional banks. For the underbanked population, DeFi offers services like loans and savings accounts, opening up a new world of financial possibilities.
While centralised exchanges continue to dominate the region, the growing interest in DeFi signals a shift towards a more decentralised future for MENA’s financial landscape.
