MENA's Trailblazing Path in Crypto and AI

The Middle East and North Africa (MENA) region is swiftly establishing itself as a formidable player in global crypto adoption. The area has seen a surge in institutional involvement and favorable regulations for Web3 technology, paving the way for significant advancements.

In a recent discussion, Stephan Apel, CEO of Outlier Ventures, shared insights on the region's innovative spirit and its readiness for technological transformation.

MENA's Rise in Web3 and Market Growth

MENA has become an important hub for Web3 development, driven by a unique blend of demographic, technological, and cultural factors. The local entrepreneurial culture enhances the adoption of decentralized technologies.

“The MENA market has set a standard for adopting next-gen technologies, particularly Web3. This region recognized their potential early, providing essential resources that allow projects to thrive on both regional and global stages,” Apel explained.

This supportive environment is leading to the emergence of an increasing number of startups, investors, and developers exploring the diverse applications of Web3.

A report by Chainalysis highlights that MENA ranks as the seventh largest crypto market globally, with $338.7 billion in online transactions from July 2023 to June 2024, constituting 7.5% of the worldwide total.

While overall market size may be smaller, the rate of adoption within MENA is impressive. Notably, Turkey and Morocco are among the top 30 countries globally for crypto adoption, with significant transaction values recorded.

Additionally, a notable aspect of MENA's crypto landscape is the dominance of institutional players, as 93% of all transaction values involve amounts exceeding $10,000.

MENA's Shift Towards AI Innovation

The rise of Artificial Intelligence (AI) is prompting frameworks for technological transformation in MENA, with countries like Qatar, Saudi Arabia, and the UAE prioritizing advanced technology.

A report from PwC predicts that AI could add up to $15.7 trillion to the global economy by 2030, with the MENA region alone expected to contribute around $320 billion.

“It’s evident that MENA has become a global hub for emerging sectors like Web3 and AI, with major cities like Abu Dhabi and Dubai attracting significant international interest,” Apel stated.

In terms of absolute gains, Saudi Arabia is anticipated to see the most significant economic impact from AI advancements, contributing approximately 12.4% to its GDP by 2030.

Saudi Arabia's Investment in AI Development

Since 2016, Saudi Arabia has pursued its Vision 2030 initiative to diversify its economy, with a central focus on AI and data-driven technologies.

“Saudi Arabia’s aggressive investments in emerging technologies are establishing a conducive environment for talent and entrepreneurship,” Apel remarked.

Under the guidance of the Saudi Data and Artificial Intelligence Authority (SDAIA), the country is implementing its national strategy for AI, including creating a central National Data Bank for data monitoring and analysis.

The UAE's Strategic AI Initiatives

Launching its National Strategy for Artificial Intelligence in 2017, the UAE aims to position itself as a leader in AI by 2031. This strategy affects multiple sectors, including education and tourism.

“Support for AI development in the UAE will generate new revenue streams and enhance global competitiveness,” Apel added.

The region continues to see robust investment in technology initiatives, enhancing startup ecosystems across sectors.

The Integration of AI, Web3, and IoT

The convergence of AI, blockchain, and the Internet of Things (IoT) is gaining traction within businesses, presenting opportunities for increased efficiency and innovation.

“These technologies complement each other, enhancing automation and transparency across systems,” Apel emphasized.

An example includes the Dubai Airport Freezone Authority's launch of Dubai Blink, integrating multiple technologies to streamline global trade and improve efficiencies.

Overall, MENA’s proactive approach to technological advancement indicates its future role as a key architect in defining the digital economy.