The Middle East and North Africa Lead Crypto Adoption: Chain Analysis
The Middle East and North Africa (MENA) is the world’s fastest-growing crypto market, with the region accounting for $566 billion in cryptocurrency payments from July 2021 to June 2022, up 48% from last year, according to a Wednesday report from blockchain analytics firm Chain Analysis.
Emerging markets dominated Chainalysis’ 2022 Global Crypto Adoption Index, with Latin America second in transaction volume growth of around 40% from last year. North America was third with growth of around 36%, but with Central and South Asia close behind.
While MENA may be one of the smaller crypto markets measured by Chainalysis, it is on the rise in usage, with Turkey, Egypt and Morocco in the top 25 this year.
Egypt was MENA’s fastest growing crypto market, with transaction volume tripling in this year’s report compared to last year. The growth was supported by the country’s National Bank project to build a crypto-based remittance corridor with the United Arab Emirates, where many Egyptian citizens work. Remittance payments account for approximately 8% of Egypt’s GDP.
Turkey remains Chainalysis’ most prominent cryptocurrency market in the region, with its citizens receiving US$192 billion from July 2021 to June 2022. Still, it has seen lower year-over-year growth than Egypt and Morocco.
In Turkey and Egypt, high inflation rates and rapid fiat currency devaluations are likely to push some investors to crypto as an alternative means of preserving their savings, the report said. Against the US dollar, the Turkish lira has weakened by more than 100% over the past year, while the Egyptian pound has weakened by more than 25%, according to MarketWatch data.
Inflation has been most severe in Turkey, with the Turkish Statistical Institute reporting that annual inflation was above 83% in September. However, the independent inflation research group ENAGrup estimates annual CPI inflation to be around 186% at press time.
In Morocco, inflation rates have been more moderate. Chainalysis said the North African country’s high ranking on the index is likely attributed to the government’s recently permissive stance on grassroots adoption.
Morocco banned cryptocurrency trading in 2017, but the asset’s popularity has since grown. Earlier this year, the country’s central bank committed to crypto regulations, with an emphasis on innovation and consumer protection.
See related article: Asia dominates Chainalysis’ 2022 crypto adoption index, China returns to top 10
