Conflict Fuels Cryptocurrency Boom in Middle East
Military conflicts and economic instability in the Middle East have accelerated cryptocurrency adoption in the region. According to Zaid Belbagi, managing partner at London's Hardcastle Advisory, this is due to a desire to preserve and transfer capital in a volatile financial environment.
The annual volume of on-chain transactions in the region increased from approximately $100 billion in 2022 to around $350 billion in 2025-2026. Unlike the global market, where growth was driven by institutional investments and regulatory changes, in the MENA region, the drivers are identified as macroeconomic pressure and government digitalization programs.
Belbagi examined the market's reaction to the escalation between Israel and Iran in June 2025. Following the initial strikes, Bitcoin fell by about 2.3% to $105,200, while Ethereum lost 7.5%. The total cryptocurrency market capitalization decreased by 3.7%.
In contrast, crypto platforms continued operations during the conflict, with local stock exchanges suspending trading in the UAE. This trend suggests that investors are shifting towards Bitcoin to reduce risk.