The regulatory clarity and certainty surrounding cryptocurrencies in the Middle East have made the region an attractive destination for major cryptocurrency exchanges and businesses. According to Binance FZE’s general manager, Alex Chehade, the progressive regulatory frameworks in the region, such as the Virtual Assets Regulatory Authority (VARA) in Dubai, the virtual asset framework of the Abu Dhabi Global Market (ADGM), and the acceptance of cryptocurrencies by Bahrain’s central bank, have created a favorable environment for startups and established industry players.
Chehade believes that regulators in other jurisdictions have not yet fully understood the cryptocurrency landscape or lack the capacity to regulate the sector effectively. This has led to an influx of global companies and events like GITEX and the Future Blockchain Summit in the Middle East, where it is easier to conduct business.
The regulatory parameters in the specific jurisdictions in the Middle East provide businesses with the certainty they need to make long-term plans. This has facilitated the establishment of an ecosystem for Web3 companies and startups in the region. Binance, as the largest Web3 company globally, plays a significant role in fostering this ecosystem. The company’s Dubai-based operation currently employs around 600 people and has been operating as a regulated exchange in Dubai for a year and a half.
These sentiments regarding the Middle East’s progressive regulatory outlook are echoed by Akshay Chopra, Visa’s vice president and head of innovation and design. Chopra highlights the forward-looking and inclusive view of blockchain and crypto solutions among regulators in the region. They actively collaborate with the local blockchain community, institutions, startups, and entrepreneurs to position the region as a market and regulator.
The Middle East and North Africa (MENA) region is also emerging as the fastest-growing cryptocurrency market globally, as per research from Chainalysis. The region recorded a transaction volume of $566 billion in crypto between July 2021 and June 2022, indicating the increasing adoption and use of cryptocurrencies in the region.
The regulatory clarity and supportive environment in the Middle East have attracted major players in the cryptocurrency industry. With the continued growth of the sector and the presence of strong regulatory frameworks, the region is poised to become a prominent hub for cryptocurrency exchanges and businesses.