MENA emerges as world's fastest-growing crypto adopter -study

By Yousef Saba
DUBAI (Reuters) - The Middle East and North Africa are the world's fastest-growing cryptocurrency markets, with crypto volume received in the region up 48% in the year to June, blockchain researcher Chainalysis said in a report on Wednesday.
While the MENA region is one of the smallest crypto markets, its growth to $566 billion received in cryptocurrency between July 2021 and June 2022 shows that adoption is increasing rapidly.
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(GRAPHIC: MENA countries by crypto transaction volume growth, July 2020-June 2021 vs. July 2021-June 2022 - https://fingfx.thomsonreuters.com/gfx/mkt/mopanxwllva/Mideast%20crypto%20growth.png)
Latin America saw the second largest growth at 40% over the same period. North America was next with growth of 36%, closely followed by Central and South Asia and Oceania with growth of 35%, Chainalysis said.
Three MENA countries are in the top 30 in Chainalysis' Global Crypto Adoption Index 2022, with Turkey ranking 12th, Egypt 14th, and Morocco 24th.
“In Turkey and Egypt, volatile cryptocurrency prices have coincided with rapid (traditional) fiat currency devaluations, boosting crypto's appeal as a savings preserver,” Chainalysis said.
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The Turkish lira has fallen nearly 30% this year to new record lows after losing 44% of its value last year amid a currency crisis fueled by rate cuts.
Turkey is by far the top of the MENA region in terms of the value of cryptos received, having received $192 billion worth of cryptos in the year to the end of June, despite posting just 10, 5% recorded.
Egypt's currency also lost around a quarter of its value against the dollar at the beginning of the year.
"Remittance payments account for about 8% of Egypt's GDP, and the country's National Bank has already started a project to build a crypto-based remittance corridor between Egypt and the United Arab Emirates, where many Egyptian indigenous people work," Chainalysis said.
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The six Gulf Cooperation Council countries “rarely make it to the top of our baseline crypto adoption index because it weights countries by purchasing power parity per capita, which favors poorer nations,” Chainalysis said.
CHART: MENA countries by crypto value received, July 2021 to June 2022 - https://fingfx.thomsonreuters.com/gfx/mkt/xmpjozbrovr/Mideast%20crypto%20adoption.png)
“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 the UAE is the fifth.”
Afghanistan, which ranked 20th in Chainalysis' Adoption Index last year, has slipped to the bottom of the list as Taliban authorities "equated crypto with gambling," which is forbidden in Islam, Chainalysis said.
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From November 2021 to now, Afghan-based users received an average of less than $80,000 in crypto per month, up from an average of $68 million per month before the Taliban takeover, Chainalysis said.
(Reporting by Yousef Saba. Editing by Jane Merriman)

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