Chainalysis has published a very relevant report on the evolution of cryptocurrencies in the MENA region. In this report, Chainalysis indicates that the Middle East and North Africa are areas that are experiencing very rapid growth when it comes to the adoption of cryptocurrencies. The report excerpt clearly states that MENA is home to one of the smallest markets for digital assets.
However, the same report also indicates that between June 2021 and June 2022, cryptocurrency users and investors based in this area traded +48% in virtual currencies. To translate this 48%, this represents approximately, 566 billion US dollars.
MENA: a high growth area for electronic currencies
MENA is a geographical area made up partly of the Middle East and North Africa. Within this region made up of several countries, three are in the top 30 countries that have massively adopted cryptocurrencies.
We find Turkey which is 12ᵉ, Egypt 14ᵉ and Morocco which occupies 24ᵉ places. According to the Chainalysis report which has been much commented on in crypto news of several major media, this observed growth can be explained by several reasons.
First, local people are looking for alternatives to avoid paying too high transaction fees by using standard money transfer methods like bank transfers and other payment solutions.
Second, the rapid devaluation of the currency used in Egypt and Turkey has encouraged the rapid and massive adoption of digital currencies as an alternative.
For Turks and Egyptians, cryptocurrencies are seen as a more reliable alternative for storing as well as transferring wealth.
Still talking about this report, Egypt is the fastest growing crypto market in the MENA region. As for Turkey, it has the largest amount of cryptocurrency transactions.
Indeed, from June 2021 to June 2022, the Turks who have adopted cryptocurrencies as a means of payment traded over $192 billion in digital assets.
The report also examined the important role played by the Gulf States, Saudi Arabia and the Arab Emirates in this rapid growth.
Indeed, the links between these three great powers and the global virtual currency markets have influenced this evolution of the cryptocurrency market in the MENA region. It should also be added that Dubai played an important role in this.
Dubai and its influence in the GCC
According to Senior Director of Public Policy at BitOasis Akos Erzse, the factors that influenced adoption of bitcoin cryptocurrency in the GCC are different from those in the rest of the MENA region.
Also according to the director of this virtual currency exchange based in Dubai, the adoption of Bitcoin in the GCC region is driven by young people who are very enthusiastic compared to to blockchain technology. This young generation also has the financial means to invest in cryptocurrencies.
This mass adoption also involves major financial institutions, retail and user-customers who have started collaborating with companies using Bitcoin as well as other digital currencies as a method of payment.