The Bitcoin Policy Institute said in a report published Friday that annual blockchain transaction value across the Middle East and North Africa reached $350 billion by 2025–2026, more than triple the roughly $100 billion recorded in 2022.
According to the report, the conflict involving Iran is pushing a growing share of regional capital into digital assets as investors look for ways to preserve wealth and move money during periods of disruption.
Report says conflict changed the pattern of capital movement
The institute’s researchers wrote that regional conflicts often speed up capital outflows, but said the Iran conflict showed a different pattern. Instead of leaving the region, a rising share of capital shifted into digital assets, which the group said shows the growing use of cryptocurrencies, especially Bitcoin, as a hedge against economic and geopolitical uncertainty.
The report links the broader rise in crypto activity to economic pressure and government efforts to build crypto markets. It also argues that the fighting increased demand for financial alternatives and highlighted the benefit of markets that stay open during disruption.
Bitcoin fell first, then gained market share
Bitcoin initially dropped with other risk assets after fighting broke out between Israel and Iran in June 2025, the report said.
“Rather than behaving as an immediate safe-haven asset, Bitcoin initially traded in line with global equity markets as investors adopted a classic risk-off posture,” the report said.
Investors later moved out of riskier cryptocurrencies and into Bitcoin, according to the institute. That shift pushed Bitcoin’s share of the crypto market to a one-month high of 64.8%. Its price then stabilized even as the fighting continued.
The institute said investors used Bitcoin to shield money from the economic fallout of the conflict, including higher oil prices, inflation and interest rates. It also said crypto markets staying open 24/7, while traditional markets closed, added to that appeal.
Currency weakness lifted use of Bitcoin and stablecoins
The report named Egypt, Turkey, Lebanon and Iran as countries where currency depreciation encouraged people to use Bitcoin and U.S. dollar-pegged stablecoins to preserve purchasing power.
“Rather than slowing regional adoption, the episode highlighted the growing divergence within MENA,” the report said. “In countries experiencing sanctions, conflict or currency instability, cryptocurrencies served as a means of preserving wealth and transferring value outside traditional financial systems, while regulated Gulf markets continued to attract institutional capital and strengthen their position as the region's leading centers for digital assets.”
Decrypt said the Bitcoin Policy Institute did not immediately respond to its request for comment.
Chainalysis tracked outflows from Iranian exchanges
The report also cited more recent activity in Iran as an example of how quickly money can move after an attack. Chainalysis tracked about $10.3 million leaving Iranian crypto exchanges between February 28 and March 2 this year following U.S.-Israeli airstrikes.
Chainalysis cautioned that those transfers could include personal withdrawals, exchange liquidity management, or state-linked actors moving assets.
UAE and Bahrain continue building regulated crypto markets
The report also pointed to the UAE and Bahrain’s efforts to attract crypto firms and institutional investors by putting regulatory frameworks in place.
In May, Kraken parent company Payward said it had received preliminary authorization from Dubai’s Virtual Assets Regulatory Authority for broker-dealer and investment management activities.
