Survey finds strong crypto use and penetration in Saudi Arabia

Survey finds strong crypto use and penetration in Saudi Arabia
Survey finds strong crypto use and penetration in Saudi Arabia

Saudi Arabia is a significant market for digital currencies due to the strong penetration and adoption of cryptocurrencies there, showing the MENA region’s potential for growth.

A survey by the cryptocurrency exchange KuCoin found that as of May 2022, 3 million Saudi Arabians (or 14% of the adult population aged 18 to 60) were either current owners of cryptocurrencies or had traded in the previous six months.

Another 17% of those surveyed were classified as “crypto-curious” and are likely to make an investment in cryptocurrencies in the upcoming six months. According to the study’s findings, potential crypto investors in the Arab country have a long-term interest. 49 percent of cryptocurrency investors in the first quarter of 2022 planned to raise their holdings during the next six months.

As the bearish market started in the second quarter of 2022, investor attitude switched in favor of more cautious cryptocurrency investing strategies. Thirty-one percent of cryptocurrency owners in Saudi Arabia stated they would not increase their balance. According to the poll, investors with lesser incomes reduced some of their holdings within the same time period.

With 76 percent of cryptocurrency investors having less than a year of experience in the industry, including 49 percent who just started trading cryptocurrencies in the last six months, Saudi Arabia has an unprecedentedly high proportion of new market entrants.

According to the survey, 63 percent of cryptocurrency investors are men in terms of demographics. The gender distribution has not changed over time. A third of all cryptocurrency investors are under the age of 30, and that percentage increased to 37% in Q2 2022.

The sole type of cryptocurrency trading that some Arab theologians deem halal is spot trading, which is done by half of the investors using fiat currency once a month. The Saudi Arabian Oil Company (Saudi Aramco), which invested $5 million in the blockchain-based oil trading company Vakt last year, stoked interest among cryptocurrency enthusiasts. In addition to automating and digitizing post-trade procedures, Saudi Aramco was reportedly planning to start mining Bitcoin (BTC).

Although the Kingdom of Saudi Arabia has not yet made any official legislation regarding cryptocurrencies available, the administration seems to have adopted a positive posture toward digital assets and blockchain technology.

A digital currency named Aber was jointly unveiled in 2019 by the Saudi Arabian Monetary Authority (SAMA) and the Central Bank of the United Arab Emirates (UAECB). The cryptocurrency is backed by the respective fiat currencies of the two nations and will be used for cross-border payments between them.