The status of cryptocurrencies in the Middle East is something of a mixed bag. While the use of cryptocurrencies has grown in recent years, the authorities are skeptical about crypto and have tried their best to restrict crypto mining and trading operations. The major chunk of blockchain startups in the region are based out of territories like the UAE, which are considered to have friendly attitudes towards cryptocurrencies. However, according to experts, crypto adoption is set to happen more rapidly in countries where political and economic instability is rampant—for example, Lebanon and Iran.
In Iran, inflation is currently more than 40%, with prices of everyday items skyrocketing. The U.S. sanctions haven’t exactly helped their cause, and many of the country’s citizens have been pushed into poverty. However, despite these negatives, crypto mining is thriving in the country because of government support and low prices of electricity. Bitcoin mining was recognized by the Iran government two years back, and a mining licensing system was also established. Iranians who are into crypto see it as a way to overcome international sanctions and embargoes. They also see it as a hedge against the rial’s devaluation.
The economic crisis of Lebanon is also pushing the Lebanese people towards crypto. Most of the crypto trading in Lebanon is done on Whatsapp and Telegram in the form of peer-to-peer (P2P) trading. These trends aren’t illogical, especially if you consider the expenses of acquiring greenbacks and the depressed state of the country’s economy. As political and economic instability is a constant feature across several other nations in the Middle East, you can expect them to adopt crypto just like Lebanon and Iran.
