People in the MENA region received $566bn in cryptocurrency from July 2021 to June 2022.
While this was one of the smaller crypto markets, according to a report by Chainalysis, the 48 percent increase on the previous year makes it the fastest growing.
The 2022 Global Crypto Adoption Index said MENA-based users received $566bn in cryptocurrency from July 2021 to June 2022, 48 percent more than they received the year prior.
Three of the top 30 countries in the 2022 Global Crypto Adoption Index are in the MENA region.
Turkey (12), Egypt (14), and Morocco (24) all feature prominently and are seeing significant increases in use of cryptocurrency. Use cases around savings preservation and remittance payments as well as increasingly permissive crypto regulations help explain why.
A preview of the Chainalysis report said: “In Turkey and Egypt, fluctuating cryptocurrency prices have coincided with rapid fiat currency devaluations, strengthening the appeal of crypto for savings preservation. The Turkish Lira has inflated by 80.5 percent in the last year; the Egyptian Pound has weakened by 13.5 percent.”
Also significant, however, is Egypt’s remittance market. Remittance payments account for about 8 percent of Egypt’s GDP, and the country’s national bank has already begun a project to build a crypto-based remittance corridor between Egypt and the UAE, where many Egyptian natives work.
Egypt saw the greatest transactional volume increase between June 202 and July 2021. It increased 221.7 percent, compared to 194.8 percent in Saudi Arabia, 120.9 percent in Lebanon, 120.9 percent in Morocco and 37.2 percent in the United Arab Emirates.
Outside the region, Latin America was the fastest growing market in the same period, at 40 percent. North America was a larger market, but still saw a 36 percent increase in usage, followed closely by Central and Southern Asia and Oceania at 35 percent growth, Chainalysis said.
Turkey tops the MENA region in terms of value of crypto received by far, having received $192 billion worth of crypto in the year to end-June.
Cryptocurrency in the GCC
Chainalysis said: “As key business hubs of the MENA region, the member states of the Gulf Cooperation Council (GCC) – Saudi Arabia, Kuwait, the United Arab Emirates, Qatar, Bahrain, and Oman – seldom make it to the top of our grassroots crypto adoption index, as it weighs countries by purchasing power parity per capita, which favours poorer nations.
“Nevertheless, their role in the crypto ecosystem should not be underestimated. Saudi Arabia, for example, is the third-largest crypto market in all of MENA, and UAE is fifth.
“They also have deep ties to the global crypto markets: in our Sub-saharan Africa and Central and Southern Asia sections, we find that Dubai has become a hub for crypto companies that serve customers all across Asia and Africa, not just in the Middle East.”
Afghanistan once led the MENA region as a grassroots cryptocurrency adopter, but has since seen a major downturn.
Crypto and the Taliban
Chainalysis said: “Afghanistan placed 20th in our 2021 crypto adoption index, but since the Taliban’s takeover last August, has fallen to the bottom of the list.”
Under the Taliban’s rule, dozens of crypto dealers have been arrested, and the ruling state agency, the Ministry for the Propagation of Virtue and the Prevention of Vice, clamped down on its usage.
From November 2021 to now, Afghanistan-based users received less than $80,000 in crypto a month on average from $68 million a month on average before the Taliban’s takeover, Chainalysis said.
This week it was reported that Kim Kardashian has agreed to pay a fine of $1.26m and not to tout any digital assets for three years after being found to have promoted a cryptocurrency on her Instagram page without disclosing that it was a paid advertisement.
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