According to Bitget Research, cryptocurrency adoption in the Middle East is gaining momentum, with the average daily number of cryptocurrency traders in the area surpassing 500,000 in February 2024.
The sharp jump represents a 51% increase from February 2023, according to data from the Centralized Cryptocurrency Exchanges (CEX) . The region is heavily dependent on global cryptocurrency platforms due to poor market depth and token availability on local exchanges.
Growing adoption of cryptocurrencies in the Middle East
Among countries in the region, the United Arab Emirates leads the way in terms of per capita adoption, with peak daily active users reaching 106,111 in 2024. This compares with Saudi Arabia ‘s peak daily active users of 129,397, even though its population size is about three times that of the UAE. Year-on-year, the UAE saw a 68% increase in the number of daily transactions. Morocco , on the other hand, recorded the highest annual growth of 148% year-on-year.
According to Bitget, part of the increase in cryptocurrency adoption in the region is related to changing views on how cryptocurrencies intersect with Muslim beliefs – around transactions that facilitate gambling or other immoral behavior.
“Due to the high volatility and uncertainty that previously existed in the cryptocurrency market, traditional Islamic principles do not recommend that Muslims participate in high- volatility cryptocurrency transactions,” the Bitget report said. “However, as cryptocurrencies, especially assets such as Bitcoin, have become more regulated in recent years, Muslim countries’ attitudes toward cryptocurrencies have begun to change.”
DEX Adoption
Although CEX exchanges are on the rise, Middle Eastern users are also fans of decentralized finance (DeFi), using decentralized exchanges (DEX) such as Uniswap, PancakeSwap and Raydium . The most commonly used cryptocurrency wallets in the region are Trust Wallet, MetaMask, Phantom, Coinbase Wallet and Bitget Wallet.
Bitget expects the number of active cryptocurrency users in the Middle East to grow to 700,000 by the end of 2024.
“The UAE will become a central hub for cryptocurrency talent, capital and businesses in the Middle East, while increasing its global influence on cryptocurrencies,” he added.
The recent conflict in the Middle East over Iran and Israel has caused a shift in cryptocurrency markets in recent weeks, briefly pushing Bitcoin back below $60,000 last week.
