In simple terms, there has been a significant surge in the cryptocurrency markets of the Middle East. The number of daily traders has increased by 166% compared to the previous year, based on a recent report from Bitget Research, the research division of prominent crypto exchange Bitget. Several reasons contribute to this increase in interest, including lenient regulations, rising cryptocurrency values, and the UAE emerging as a major crypto hub in the region.
Though the usage of centralized exchanges (CEXs) has generally increased, the report highlights a significant difference in user preferences for trading platforms. Specifically, an average of 500,000 daily active users chose CEXs in February 2024, marking a substantial jump from the 300,000 recorded during the same period last year. However, this growth underscores a divergence in user preferences, with CEXs becoming more popular compared to other available options.
Centralized exchanges hold more sway because they provide a wider range of tradeable assets and greater liquidity than local platforms. Additionally, the ease of depositing and withdrawing in local currencies is a significant draw for users.
UAE Leads the Charge with Crypto-Friendly Policies
The United Arab Emirates stands out as the leader in cryptocurrency adoption throughout the Middle East. This is consistent with the country’s forward-thinking approach to digital assets. Notably, the UAE boasts the most favorable crypto policies among its neighbors. Moreover, the recent green light for Bitcoin Spot ETFs has sparked increased investor enthusiasm.
The UAE’s favorable regulatory attitude towards cryptocurrency has resulted in a high level of engagement with it within the region. According to the survey, an impressive 72% of individuals in the UAE have invested in Bitcoin, viewing it as a digital form of gold. Additionally, nearly one-third of users see crypto as a convenient method for holding assets, and over a third are actively trading cryptocurrencies.
International centralized exchanges hold significant importance in the region, as shown by the research. Local exchange platforms like Rain and M2 face challenges in competing for the top 10 spots in terms of user engagement. This trend is fueled by the extensive range of services and superior liquidity offered by international exchanges over their local counterparts.
Crypto Adoption in the Middle East Set to Soar in 2024
According to Bitget’s forecast, there will be a steady increase in cryptocurrency usage throughout the Middle East by 2024, with an estimated 700,000 users engaging daily. This trend is fueled by regulatory improvements in the area that encourage fresh investments and crypto-related projects. Gracy Chen, Bitget’s Managing Director, shares her optimistic view on the region’s prospects.
“The Middle East market holds great promise for us, with expectations of expanding user base and market growth. The UAE stands out as a key player in this region. We’re eager to be part of its progression and observe its continued evolution into an even more vibrant market.”
Instead, the preeminence of traditional exchanges may not last forever. Notably, there’s a rising trend towards decentralized exchanges (DEXs) in this area as per the report.
More and more people are shifting towards Decentralized Exchanges (DEXs) for direct trading between each other. These exchanges operate on blockchain networks such as Solana, Binance Smart Chain, and Ethereum. Notable DEXs include Uniswap, Pancakeswap, and Raydium. Furthermore, decentralized exchange aggregators like 1inch and Jupiter are also becoming popular choices.
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2024-04-22 19:42