Bitget Research Institute: The Middle East, a rising star in the crypto market

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Bitget研究院
1 months ago
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At present, the average daily number of people participating in transactions in this area has reached about 500,000.

Original source: Bitget Research Institute

Bitget Research Institute: The Middle East, a rising star in the crypto market

Summary

  • The Middle East is an emerging market for cryptocurrencies. Currently, the average number of people participating in transactions in the region is about 500,000 per day.

  • In terms of regulatory environment, the UAE has the most friendly cryptocurrency policy, while the cryptocurrency policies of most other Middle Eastern countries have gradually improved, from early explicit prohibitions to gradual compliance;

  • In terms of on-chain preferences, Middle Eastern users are interested in participating in decentralized projects, are familiar with DEX on-chain tools, and are willing to participate in the metaverse, games, and on-chain task platforms. The growth rate of on-chain users has increased significantly in recent years.

  • In terms of trading preferences, institutional users in the Middle East mainly invest in core crypto assets such as BTC, while retail investors pay more attention to a wider range of areas and are willing to participate in the hype of Meme coins;

  • In terms of preference for centralized exchanges, the traffic of centralized exchanges in the Middle East has shown a fluctuating upward trend in the past year, and the demand for centralized exchanges among Middle Eastern users is significantly higher than that for decentralized exchanges. In terms of decentralized exchanges, Middle Eastern users mainly use decentralized exchanges such as Uniswap and Pancakeswap, which are the top public chain exchanges. The most commonly used wallets are TrustWallet, Metamask, Phantom, Coinbase Wallet, and Bitget Wallet.

  • Finally, based on the above analysis, Bitget Research Institute made five predictions for the future trend of the Middle East crypto market.

beginning

The Middle East has a long and glorious history. It was once one of the centers of civilization in the ancient world. Its unique culture, science and trade traditions have left a profound impact on human history. Faced with the rise of cryptocurrency, Middle Eastern countries are unwilling to lag behind and quickly make up for their shortcomings in policies and industries, becoming a rising star in cryptocurrency.

Although the popularity of cryptocurrency in the Middle East is not high at present, its growth rate is very impressive. Currently, the way most Middle Eastern users participate in the cryptocurrency market is to invest in cryptocurrency directly through centralized exchanges.

Through in-depth market research, this article provides a panoramic introduction to the current status of the Middle East crypto market, which not only helps Middle Eastern users find their own ecological positioning and communities with similar interests, but also helps Web3 project teams and crypto institutions better understand and develop the Middle East market.

1. Overall market situation

1. Regional Overview

According to information from Wikipedia, there are 18 countries in the Middle East. Considering the activity level of cryptocurrencies, this article will focus on six countries: UAE, Saudi Arabia, Egypt, Morocco, Algeria, and Jordan.

Bitget Research Institute: The Middle East, a rising star in the crypto market

In terms of the total volume and acceptance of cryptocurrencies, the Middle East does not perform well in the world. The total amount of cryptocurrencies received by the Middle East and North Africa in 2023 accounts for about 7.2% of the world. However, due to its open policies and rapid development, it is still an extremely important part of the crypto world. According to Chainalysiss 2023 Adoption Index data ranking, Morocco, Egypt, Algeria, Saudi Arabia, Jordan, and the UAE ranked 20th, 35th, 47th, 57th, 66th, and 78th respectively.

It is worth noting that different countries in the Middle East have significant differences in their acceptance of centralized platforms and decentralized applications. Egypt, Algeria, and Jordans data rankings on DeFi are far lower than their rankings on centralized platforms; while Saudi Arabia and the UAEs global rankings in DeFi use are significantly stronger than their rankings on centralized platforms; Moroccos data is relatively balanced, and the five aspects involved in the Adoption Index are ranked in the top 20 in the world.

In addition, it can be noted that the UAE’s P2P trading ranking is after the top 100 in the world, which may indicate that the UAE is less dependent on P2P in terms of fiat currency deposits and withdrawals, and has more convenient deposit and withdrawal methods.

2. Encryption policy and human impact

2.1 Encryption policies in Middle Eastern countries

Due to their different economic development levels and cryptocurrency penetration rates, Middle Eastern countries have different attitudes towards cryptocurrency regulation. This section introduces the similarities and differences in regulatory policies of Middle Eastern countries from the perspectives of regulatory-friendly, policy-shifting, and strong regulation. From the perspective of the countries surveyed, the country with regulatory-friendly cryptocurrency is the UAE, the countries with policy-shifting are Saudi Arabia, Jordan, Egypt, and Morocco, and the Middle Eastern countries with strong regulation include Algeria.

[Regulatory-friendly]

The representative of the Middle Eastern countries with friendly cryptocurrency regulation is the UAE. The UAE cryptocurrency policy involves the following aspects:

  • The UAE s financial regulator is the Central Bank of the United Arab Emirates, which is responsible for regulating and managing the financial market. On March 9, 2022, Dubai issued Law No. 4 on Virtual Asset Regulation to establish a new regulatory agency called the Virtual Asset Regulatory Authority (VARA). VARAs scope of authority includes regulating virtual asset service providers throughout Dubai. In addition, the UAE has created various cryptocurrency-friendly regions by establishing financial autonomous regions and RAK DAO, attracting cryptocurrency companies, talents, and capital influx.

【Policy Shift Type】

The Middle Eastern countries where cryptocurrency policies are shifting include Saudi Arabia, Egypt, Jordan, and Morocco, mainly in the following aspects:

  • Saudi Arabia: In 2018, the Saudi government declared the use of Bitcoin illegal, citing potential risks in trading other cryptocurrencies. Despite this, the countrys cryptocurrency market has continued to grow. By September 2022, the Saudi Central Bank hired tech entrepreneur Mohsen Al Zahrani as the so-called Crypto Sheikh to lead the digital transformation of the central banking system. In addition, Saudi Arabia has expressed interest in diversifying its economy by fostering Web3 and blockchain gaming projects. One of the projects is a collaboration with The Sandbox to explore a virtual universe.

  • Egypt: In 2018, Egypt’s main Islamic lawmaker, Dar al-Ifta, issued a religious decree classifying commercial transactions in Bitcoin as illegal. But in 2019, the Central Bank of Egypt (CBE) announced that it was working on a draft law that would simply prohibit the creation, trading, or promotion of cryptocurrencies without permission, a statement that revealed the CBE’s changing views on digital currencies and cryptocurrencies. In 2020, the Egyptian Parliament enacted the Central Bank and Banking Law to help the digital transformation of Egypt’s banking and financial sectors.

  • Jordan: The Central Bank of Jordan (CBJ) has enacted legislation prohibiting all banks, currency exchange companies, financial entities and payment service providers from facilitating any cryptocurrency transactions. Jordan recently expressed a positive attitude towards cryptocurrency and blockchain technology, viewing it as an opportunity for innovation and development. The Central Bank of Jordan has stated that it encourages banks and financial institutions to explore and utilize the development of blockchain technology and digital assets under the premise of complying with relevant regulations.

  • Morocco: In 2017, the Moroccan government announced that cryptocurrency transactions were banned in Morocco; in June 2022, the Central Bank of Morocco prepared to draft a cryptocurrency regulatory bill; in January 2023, the Central Bank of Morocco announced the relevant content of the cryptocurrency draft, including cryptocurrency-related definitions.

[Strong supervision type]

Algeria is a Middle Eastern country with strong cryptocurrency regulation. Its cryptocurrency policy covers the following aspects:

  • Algeria: Algeria’s 2018 financial law prohibits the use of any cryptocurrency. It states: The purchase, sale, use and possession of so-called virtual currencies are prohibited. Virtual currencies are characterized by electronic products that lack physical support.

2.2 Humanistic influence of Middle Eastern countries

Middle Eastern Muslim countries vary in their policies and attitudes toward cryptocurrencies, but generally speaking, their regulation is influenced by Islamic law.

From the perspective of Islamic law, Islamic law has a series of regulations on financial activities, such as prohibiting usury, prohibiting gambling, prohibiting transactions involving illegal and immoral behavior, etc. Since the cryptocurrency market has experienced high volatility and uncertainty, Muslims are not recommended to participate in crypto transactions with large fluctuations from the perspective of Islamic tradition. However, cryptocurrencies, especially assets represented by Bitcoin, have gradually become compliant in recent years, and the attitude of Muslim countries towards cryptocurrencies has begun to change.

Some Muslim countries are also working hard to develop regulations that adapt to modern financial technology and innovation, and to a certain extent accept and support the development of cryptocurrencies. For example, Dubai in the UAE plans to develop into a blockchain and cryptocurrency innovation center, which shows that these Middle Eastern countries are open to these emerging technologies.

3. Market size

In February 2023, the DAU of cryptocurrency traders in the entire Middle East on centralized cryptocurrency exchanges was about 330,000. With the approval of BTC Spot ETF and the continuous rise in the total market value of the cryptocurrency market, by February 2024, the DAU of cryptocurrency traders in the Middle East on centralized cryptocurrency exchanges will reach about 500,000.

Bitget Research Institute: The Middle East, a rising star in the crypto market

In February 2024, the DAU of cryptocurrency trading in centralized exchanges in several countries in the Middle East was roughly in the range of 100,000 to 150,000. It is worth noting that the population of the UAE and Morocco is about one-third of that of Saudi Arabia and Egypt, but the DAU of cryptocurrency trading is not much different from that of Saudi Arabia and Egypt. This reflects that the popularity and usage rate of centralized cryptocurrency exchanges in the UAE and Morocco are significantly higher than those in Saudi Arabia and Egypt.

In the past year, among the Middle Eastern countries, Morocco saw the fastest year-on-year increase in the number of trading users, with an increase of 148%, followed by the UAE and Egypt, with an increase of about 70%. However, Saudi Arabias data for February 2024 was the same as that for February 2023, mainly because three of the five largest centralized exchanges experienced a decline in traffic. This phenomenon may also be caused by Saudi Arabias earlier traffic growth cycle than other countries. Multiple information sources show that Saudi Arabia is the country with the highest year-on-year growth in cryptocurrency transactions in the world from 2022 to 2023.

2. Characteristics of local cryptocurrency users

1. User trading habits

1.1 Overall Profile of Users in Middle Eastern Countries

Bitget Research Institute: The Middle East, a rising star in the crypto market

Image: Word cloud of cryptocurrency user habits in the Middle East

Source: Google Hot Words

Middle Eastern users are open to cryptocurrency transactions and project interactions, and generally have the following characteristics:

  • High reliance on CEX: Middle Eastern users rely more on CEX than DEX, with nouns such as Exchange appearing in the word cloud;

  • Transferring money through cryptocurrency: The popularity of using cryptocurrency for money transfers among Middle Eastern users is relatively high, mainly due to the rapid depreciation of legal currencies in several Middle Eastern countries and the low penetration rate of traditional banks;

  • Pay attention to Meme coins: Middle Eastern users are enthusiastic about hyping Meme coins, pay attention to the markets Heat Map, and have the ability to quickly grasp the heat of the crypto market;

  • Focus on traditional finance: Blackrock has become a hot search term for Middle Eastern users, indicating that Middle Eastern users are concerned about the impact of BTC ETFs and traditional finance on the crypto market.

1.2 Transaction and interaction habits of users in the Middle East

[United Arab Emirates]

According to a research survey by financial services company Holborn Assets, users in the UAE are increasingly interested in using cryptocurrencies. 29% of users believe that cryptocurrencies are a more convenient way to hold assets, 34% of users are cryptocurrency traders, and 22% of users use them for daily payments. As for investment attributes, UAE users are most willing to invest in BTC and ETH. BTC is called digital gold by UAE users, and 72% of users invest in BTC.

In terms of interaction habits, UAE users are good at using the trading and lending functions of DEX and are familiar with on-chain operations. In addition, UAE users pay attention to the latest things in the crypto market and pay more attention to projects such as RWA, Metaverse, AI, and cross-chain bridges.

【Saudi Arabia】

According to the Chainalysis report, Saudi Arabias regional cryptocurrency trading volume increased by 12% between 2023 and 2022. Saudi Arabian users invest in the spot of core cryptocurrencies such as BTC and ETH to achieve more diversified assets. In addition, institutional users in Saudi Arabia are increasingly interested in investing in cryptocurrencies.

In terms of interaction habits, the proportion of Saudi Arabian users using on-chain DEX is lower than the world average, but users in the region have shown interest in metaverse applications and NFTs. For example, Sandbox announced a partnership with Saudi Arabia to launch a virtual universe.

【Egypt】

According to Triple-A survey data, the popularity of cryptocurrency in Egypt is relatively low. As of 2022, only 2.95% of Egyptians have held cryptocurrency. In terms of transactions, Egyptian users mainly hold BTC, and the core reason is to cope with the depreciation of Egyptian legal currency. In addition, 2/3 of Egyptian users do not have traditional bank accounts, and some users use cryptocurrency for domestic and international remittances.

Due to the small number of user samples in [Algeria], [Morocco], and [Jordan], the summary results may have large errors and no specific summary is made.

2. Popular sectors and projects

(1) Popular projects popular sectors

Bitget Research Institute: The Middle East, a rising star in the crypto market

Traffic of popular projects by UAE users (Q1 2024)

[UAE]: The main projects and sectors that UAE users participate in are DEX, Web3 task platform and NFT trading platform. Among them, mainstream token market websites such as dextool, dexscreener, poocoin, birdeye, etc. are more popular; DEX trading platforms pancakeswap and uniswap are more popular among UAE users; Opensea and magiceden are more popular in NFT; Web3 task platform galxe is more popular.

Bitget Research Institute: The Middle East, a rising star in the crypto market

Traffic of popular projects by Saudi users (Q1 2024)

[Saudi Arabia]: Saudi users are enthusiastic about DEX transactions, Web3 task platforms, NFT transactions and games. NFT transactions are mainly on Opensea and Magiceden platforms; on the other hand, a small number of users use Sandbox and Axie, and Web3 task platforms are mainly concentrated on galxe and zealy.

Bitget Research Institute: The Middle East, a rising star in the crypto market

Traffic of popular projects by Egyptian users (Q1 2024)

【Egypt】: Egyptian users have a high degree of participation in Web3 games, DEX transactions, NFT and task platforms. Sweat Economy is relatively popular in Egypt, indicating that the M2E model is relatively popular in Egypt; DEX is mainly market websites and PancakeSwap; in terms of games, in addition to Sandbox, the recently popular Pixels has also received a certain amount of attention in Egypt.

Bitget Research Institute: The Middle East, a rising star in the crypto market

Traffic of popular projects by Moroccan users (Q1 2024)

[Morocco]: Moroccan users are highly involved in NFT and DEX transactions. NFT transactions are mainly on Opensea and Magiceden platforms; on the other hand, a small number of users use Sandbox and Sweat Economy.

(2) In the past three months, the topic of cryptocurrency that Middle Eastern users are most concerned about is

See what Middle Eastern users are interested in through Google Search:

Bitget Research Institute: The Middle East, a rising star in the crypto market

The most popular keywords that Middle Eastern users search for Crypto on Google Search

According to the search popularity of cryptocurrency-related terms by Middle Eastern users on Google, in the past three months (January 5, 2024 - April 5, 2024), the focus of users in the Middle East has mainly focused on:

(1) BOME:

The hype of Solana meme coins lasted throughout Q1, and the Middle East was no exception. BOOK OF MEME (BOME), released by Pepe Meme artist Darkfarm, swept all social platforms. After its launch, the 24-hour trading volume on the chain exceeded US$250 million, and it was quickly listed on major exchanges. However, SLERF, which is also highly discussed, did not make the list in any of the Middle Eastern countries. To a certain extent, it means that the transactions of Middle Eastern users mainly occur on the top few centralized exchanges, and there is still a lot of room for development in the use of DEX.

(2) RWA (ONDO):

BlackRock announced the launch of its first tokenized fund issued on a public chain. The entry of giants has given a second spring to the RWA track. RWA may still be one of the most important narratives in this round of bull market. The Middle Eastern countries have a high search volume for the hot word RWA, but ONDO is the only token on the list, while GFI, MKR, etc. are all on the list. Combined with ONDO is also the 5th place in the Google Search for Cryptocurrency-related Terms in Western Europe in early 2024 in the Bitget Research Institutes Western European Market Research Report, it can be seen that ONDO may be one of the flagship tokens of this round of RWA hype.

(3) Device mining and mobile phone mining type tokens (ICE, DePIN, Grass, PI):

Users in the Middle East seem to be very interested in Mining Crypto, with three projects in this field making the list:

(a) A cloud computing and network sharing project without token issuance, Wynd Network’s flagship product Grass;

(b) Mobile phone mining and Layer 1 project ICE, which was recently launched;

(c) Pi Network (PI), an early mobile mining project that was launched as early as 2018.

3. Local social media

Bitget Research Institute: The Middle East, a rising star in the crypto market

Bitget Research Institute: The Middle East, a rising star in the crypto market

Bitget Research Institute: The Middle East, a rising star in the crypto market

Bitget Research Institute: The Middle East, a rising star in the crypto market

The main battlefields for local communities in Arab countries are Twitter and Youtube, with Telegram being used less frequently. Arabic is the main language used, but English content is also spread to a certain extent.

In terms of discussion content, each country has different understanding of blockchain and different areas of interest. Saudi Arabia, Egypt, and the United Arab Emirates have a certain user base, and the content is very extensive. They have a certain habit of exposing and posting orders on exchanges, and they are very fast in tracking hot crypto altcoins. Exchange hot coins (such as ENA) are highly discussed. However, Morocco, Algeria, and Jordan have a small user base and basically do not have many local bloggers. The content of interest mainly depends on the content producers of the other three countries.

3. Competition landscape and advantages of each platform

1. Centralized Exchanges

Overall, in the past year, the number of visits to centralized exchanges in the Middle East has shown a clear upward trend. The User Visits (UV) data in the UAE and Morocco reached 60% and 71% respectively, and the data in Egypt increased by 25% year-on-year; while Saudi Arabias traffic showed a slight decline, which may be related to the fact that its fastest user growth cycle is earlier than other countries. (As mentioned above, multiple sources show that Saudi Arabia is the country with the highest year-on-year growth in cryptocurrency transactions from 2022 to 2023)

The traffic gap between the important countries in the Middle East visiting centralized exchanges is not large. Even though the total population gap is obvious, the monthly UVs visiting centralized exchanges in the four countries of UAE, Morocco, Egypt, and Saudi Arabia are all between about 700,000 and 1 million.

Middle Eastern countries are highly dependent on global centralized exchanges, and the absolute values of traffic of local exchanges Rain and M2 are both outside the top 10. This may be related to the low abundance of tradable assets and poor trading depth on local exchanges, as well as the fact that many global centralized exchanges also have convenient local currency deposit and withdrawal channels.

Bitget Research Institute: The Middle East, a rising star in the crypto market

Note: (1) Due to the lack of Saudi Arabias Mobile Web data in February 2024, only Desktop data is presented. If it is assumed that the traffic structure of Saudi Arabia and the UAE is similar, the total UV of Saudi Arabias Web, Desktop + Mobile is approximately 874,721; (2) Data for Algeria and Jordan could not be collected and are not shown here.

2. Decentralized Exchanges

Users in the Middle East frequently use decentralized exchanges, and their main usage habits are concentrated on leading decentralized exchanges on public chains such as Solana, BSC and Ethereum, such as Uniswap, Pancakeswap, Raydium, etc. Some users also use decentralized exchange aggregation products, such as 1inch and Jupiter.

Most users log in to these decentralized exchanges directly, and some log in through Google search, social media links, and market website jumps. This shows that Middle Eastern users pay more attention to brand awareness when using decentralized exchanges, and once they form a habit of using them, they will have a certain degree of loyalty to the brand.

Bitget Research Institute: The Middle East, a rising star in the crypto market

Bitget Research Institute: The Middle East, a rising star in the crypto market

U.S. and Saudi Arabia users’ use of decentralized exchanges

United Arab Emirates

DEX Competition Landscape

The UAE has a high proportion of decentralized exchanges among the Middle Eastern countries, among which UniSwap, PancakeSwap, 1inch, etc. are decentralized exchange products that are used by users. From the perspective of various public chains, the traffic of the top DEXs is relatively high, and active public chains include BSC, ETH, SOLANA, COSMOS, etc. The trading habits of the UAE are gradually shifting from DEX to aggregated products.

DEX traffic entry

UAE users mainly log in to decentralized exchange websites through direct searches. It is worth noting that Google search is also a common entry point for UAE users to enter decentralized exchanges. CMC, as a cryptocurrency information and news website, also has a large amount of traffic and conversions.

Saudi Arabia

Summary of DEX competition landscape

The transaction proportions of Saudi users on UniSwap, PancakeSwap, and Raydium are not much different, indicating that Saudi users have great interest in assets on BSC, ETH, and SOLANA. The rest of the public chains are all head decentralized exchanges, such as TraderJoe and Osmosis, which perform well.

DEX traffic entry

In terms of search and conversion, Saudi users mainly enter decentralized exchanges through direct login, Google search, social media conversion, and cryptocurrency information website conversion. Saudi users have a relatively high usage rate of Twitter.

Bitget Research Institute: The Middle East, a rising star in the crypto market

Bitget Research Institute: The Middle East, a rising star in the crypto market

Usage of decentralized exchanges by users in Egypt and Morocco

Egypt and Morocco

Summary of DEX competition landscape

Egyptian and Moroccan users have quite different trading preferences. Egyptian users prefer pancakeswap, while Moroccan users prefer jupiter. The rest of the public chains are all top decentralized exchanges that perform well. It is worth noting that Egyptian users use astroport more frequently, indicating that users are more concerned about cosmos ecosystem projects. Moroccan users trading interests are mainly concentrated on the Solana chain.

DEX traffic entry

In terms of search and conversion, users in Egypt and Morocco are similar to users in other countries. They mainly enter decentralized exchanges through direct login, Google search, social media conversion, and cryptocurrency information website conversion. Among them, coingecko is more popular among Moroccan users, and coinmarketcap is more popular among Egyptian users.

Due to the small number of user samples in Algeria and Jordan, the summary results may have large errors and no specific summary is made. The usage habits of their users for DEX are similar to those of other neighboring Middle Eastern countries.

3. Wallet

Bitget Research Institute: The Middle East, a rising star in the crypto market

Web3 wallet downloads in the Middle East (2024.01.01-2024.03.31)

(Note: Some well-known wallets, such as Binance Wallet and its centralized exchanges, share the same APP and cannot extract traffic separately, so they are not shown in the above table)

In terms of wallet usage, Trust Wallet, MetaMask, Phantom, Coinbase Wallet, and Bitget Wallet are the top 5 wallets in the Middle East.

Like most other regions, Trust Wallet and MetaMask occupy the first and second positions. Trust Wallet, a wallet launched in 2017, has a good first-mover advantage. Its simple and easy-to-use design conforms to the user habits in the Middle East. MetaMask also has a good first-mover advantage. Most EVM-compatible public chain projects generally give priority support, which makes these two wallets very popular in the Middle East.

Recently, due to the popularity of the Solana ecosystem, Phantom, as the most popular native wallet of the Solana network, has seen a significant increase in downloads, ranking third. In addition, rumors have been circulating on social media that Phantom may issue coins. In anticipation of airdrops, many users also tend to use Phantom wallets to participate in Solana ecosystem projects.

Coinbase Wallet, ranked fourth, is backed by Coinbase. Although users in the Middle East cannot use the Coinbase exchange, Coinbase Wallet can be used normally. In May 2023, Coinbase CEO Armstrong said in an interview with Bloomberg that they may turn their attention to the UAE to build a bridge between Europe and Asia. Therefore, Coinbase Wallet, backed by the authority and security of Coinbase, has become the choice of many users in the Middle East.

Bitget Wallet updates and iterates very quickly. It currently supports more than 90 public chains. At the same time, the innovative liquidity aggregation algorithm in Swap brings users a smooth trading experience. It also supports on-chain changes, smart market recommendations and other functions to assist users in capturing hot projects. Some time ago, Bitget Wallet also launched the BWB airdrop plan, and is currently actively carrying out points activities, which is favored by many users in the Middle East. In terms of NFT, Bitget Wallets NFT market is the first platform that supports the use of any cryptocurrency to purchase NFT. Insights into user needs and rapid support have made it the fifth download ranking in the Middle East.

Summarize

The Middle East has a long and glorious history and was once one of the centers of civilization in the ancient world. Faced with the rise of globalization in the crypto market, Middle Eastern countries have re-examined cryptocurrencies with an open and embracing attitude, making the Middle East the fastest growing region in the world in terms of cryptocurrency penetration. This report mainly investigates the cryptocurrency market in the six Middle Eastern countries defined by the United Nations from three aspects: overall market situation, characteristics of local cryptocurrency users, and competitive landscape and advantages of various platforms.

From the overall market situation, the total volume and acceptance of cryptocurrencies in the Middle East are in a rapid growth stage. The number of daily active users of centralized exchanges in the six Middle Eastern countries is about 500,000, among which the UAE has the highest cryptocurrency penetration rate in the Middle East.

From the perspective of regulation and cultural influence, most of the countries surveyed are Muslim countries. Influenced by Islamic rules, the crypto policy in the early days mainly restricted their citizens from participating in the crypto market to protect the rights and interests of local investors. However, as core assets such as Bitcoin gradually become compliant, they have become important alternative asset targets. The policies of Middle Eastern countries represented by the UAE have gradually embraced cryptocurrencies, and the UAE has become one of the most cryptocurrency-friendly countries in the world.

Middle Eastern users are open to cryptocurrency transactions and interactions with on-chain projects, and generally have the following characteristics:

  • The general reliance on CEX is high;

  • In areas where traditional banking services are not widely used, users will transfer money through cryptocurrencies;

  • Pay attention to Meme coins and grasp the hot assets in the market;

In terms of competition and platform advantages, global centralized exchanges provide more diverse and comprehensive services and still occupy the majority of the market share. The data of decentralized exchanges is not very different, and the usage habits are concentrated on the leading decentralized exchanges of public chains such as Solana, BSC and Ethereum. In terms of wallets, Trust Wallet, MetaMask, Phantom, Coinbase Wallet, and Bitget Wallet are the top 5 wallets in the Middle East.

Finally, after a thorough market survey by Bitget Research Institute, we expect the following developments to occur in the Middle East market by 2024 for readers’ reference:

  • The UAE is an important base for the Middle East market. It will not only become a central hub for cryptocurrency talent, capital, and crypto companies in the Middle East, but its influence on cryptocurrencies around the world will become increasingly stronger;

  • As the cryptocurrency market warms up and the popularity of cryptocurrency among Middle Eastern users increases, the DAU participating in cryptocurrency transactions in the Middle East market will continue to rise from 330,000 in 2023 to around 700,000 by the end of 2024.

  • The penetration rate of Middle Eastern users participating in various on-chain applications has increased significantly. Airdrop and on-chain mining may become hot words on social media, and the interest in the DePin track has only increased;

  • The hype of Meme coins continues to rise, and the DEX ecosystem of the leading public chains continues to become a window for Middle Eastern users to hype Meme;

  • Wallets with transaction aggregation functions will be favored by more Middle Eastern users.

Original article, author:Bitget研究院。Reprint/Content Collaboration/For Reporting, Please Contact report@odaily.email;Illegal reprinting must be punished by law.

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