The Middle East is quickly becoming a major player in the global cryptocurrency market thanks to its favourable regulatory framework.
There has been a dramatic surge in crypto trading in the region, complemented by groundbreaking developments in blockchain and tokenisation projects.
These developments are key reasons why the Middle East’s reputation as a crypto powerhouse has skyrocketed and things are unlikely to slow down.
UAE Leading the Charge as Crypto Trading Activity Hits Record High
Daily active crypto traders in the Middle East grew from 330,000 in 2023 to over 700,000 last year thanks to a combination of market recovery, the approval of Bitcoin ETFs and favourable regulations.
One of the leading contributors to this growth is the United Arab Emirates (UAE), which has emerged as a cornerstone of the region’s crypto adoption.
The UAE is ranked third globally on the Henley crypto adoption chart for 2024. Data from Chainalysis highlights that the UAE accounts for 7.5 percent of global transaction volume.
Crypto companies will continue to flock into the Middle East thanks to forward thinking policies that allow crypto service providers to operate without constantly looking over their shoulders.
This trend is expected to accelerate in the coming years but the adoption rate in the Middle East could skyrocket even further if more nations jump on the iGaming bandwagon.
The UAE is already ahead of its neighbours in that regard. However, several Middle East nations including Kuwait are still vehemently opposed to the iGaming sector.
If Kuwait were to reconsider its stance on iGaming, the country could unlock highly profitable revenue streams, especially in online slots and other elements of iGaming.
Gambling enthusiasts already play online slots in Kuwait but the government could capitalise financially through taxation if they establish a formal regulatory framework.
DMCC’s Visionary Crypto Tower
DMCC and REIT Development recently announced the launch of the world’s first Crypto Tower in the UAE. The project will support the rapidly expanding community of blockchain, DeFi and Web3 companies.
The latest venture exemplifies the country’s commitment to becoming a global hub for blockchain and digital innovation.
The Crypto Tower is located in Jumeirah Lakes Towers (JIT) – a tall landmark that will house advanced facilities for blockchain start-ups, venture capital firms and other technologies.
With over 150,000 square feet of leasable space, the tower is set to redefine how crypto and blockchain businesses operate.
The tower will feature nine floors of offices tailored for crypto start-ups and established businesses and three floors for blockchain incubators, venture capital firms and investment companies. There is an additional floor dedicated to artificial intelligence (AI) innovation powered by Chatoshi.ai.
Blockchain technology will be used to streamline tenant operations within the tower through the use of on-chain voting mechanisms and other facilities.
The idea is to build trust and transparency, reduce the load on administration and set a higher standard for decision-making and management.
Tokenisation & Real-World Assets
MANTRA, a layer-1 blockchain designed for tokenised real-world assets (RWA), recently partnered with UAE-based property conglomerate DAMAC Group to tokenise $1 billion worth of the firm’s assets.
This initiative aims to simplify investment processes and increase accessibility for retail and institutional investors.
Tokenisation is quickly gaining traction in the Middle East and beyond. It has the potential to improve efficiency, speed up settlements and expand the reach of investors. These are key areas of the process that have caught the eye of numerous institutions and governments around the world.
DAMAC’s venture into blockchain tech aligns with the UAE’s long-standing ambition to establish itself as a crypto hub. The company began accepting crypto payments in Bitcoin and Etherium for its real estate projects in 2022.
The partnership with MANTRA is a bold step toward integrating traditional finance with blockchain tech. MANTRA is focused on bringing a wide range of traditional financial assets to its blockchain in the Middle East.
MANTRA recently agreed to tokenise $500 million worth of assets of Dubai-based real estate developer MAG Group, highlighting their commitment to the region.