The Banking Executive Issue - October 2025 Issue

Onchain Finance In Arab Countries ON CHAIN FINANCE IN ARAB COUNTRIES Onchain finance in Arab countries is rapidly evolving, driven by digital transformation, youth adoption, and progressive regulatory frameworks. Across the Middle East and North Africa (MENA), Arab nations are em- bracing blockchain-based financial services, especially decentralized fi- nance (DeFi) and tokenized assets, as part of a broader digital finance rev- olution. Countries like the UAE, Saudi Arabia, and Bahrain are lead- ing with initiatives in open finance, expanding beyond open banking to include investments, insurance, and credit services. According to Statista, the regional market is forecasted to grow from $1.65 billion in 2022 to $11.74 billion by 2027, reflecting a compound annual growth rate (CAGR) of 45%. This surge is fuelled by high smartphone penetration, im- proved internet infrastructure, and government-backed fintech strategies that aim to enhance financial inclu- sion and economic participation. Arab regulators are also collaborat- ing through regional fintech working groups to harmonize standards and foster innovationamf.org.ae . GROWTH OF ON CHAIN FINANCE IN SAUDI ARABIA Saudi Arabia is actively embracing onchain finance, with major institu- tions like Saudi Awwal Bank (SAB) integrating blockchain technologies to modernize financial services. In 2025, SAB, one of the kingdom’s largest banks with over $100 billion in assets, partnered with Chainlink to deploy cross-chain interoperability and developer tools for next-genera- tion onchain applications. This move reflects Saudi Arabia’s broader strat- egy to diversify its economy and lead in fintech innovation under Vision 2030. By leveraging Chainlink’s in- frastructure, SAB aims to develop se- cure, transparent, and programmable financial services that align with ISSUE 202 OCTOBER 2025 the BANKING EXECUTIVE 79 SIZE AND GROWTH OF THE GLOBAL ONCHAIN FINANCE MARKET (SOURCE: PRECEDENCE RESEARCH) Metric Market Size Tokenized Real-World Assets (RWAs) Onchain Revenue Growth Projected Market Size DeFi Total Value Locked (TVL) $32.36 billion $24 billion +126% $1.5 trillion ~$60 billion 2025 Mid-2025 H1 2025 2034 2025 Includes DeFi, tokenized assets, and onchain financial services Up from $5 billion in 2022 (380% growth) Driven by blockchain application fees Based on a compound annual growth rate (CAGR) of over 53% Reflects capital in decentralized finance protocols Value Year Notes KEY ASPECTS OF ONCHAIN FINANCE IN ARAB COUNTRIES Country UAE Saudi Arabia Bahrain Egypt Jordan Qatar Lebanon Dubai and Abu Dhabi host blockchain hubs; active in tokenized assets and DeFi Vision 2030 includes digital finance; partnerships with blockchain firms Early adopter of crypto regulation; hosts regional DeFi platforms Exploring blockchain for remittances and financial inclusion Blockchain pilots in government and finance sectors Fintech sandbox includes blockchain startups Grassroots crypto adoption amid banking crisis Pro-innovation; clear crypto regulations Supportive but cautious; exploring Central Bank Digital Currencies (CBDCs) Progressive; crypto licenses issued Conservative; limited crypto access Monitoring developments Restrictive on crypto; open to innovation Unregulated; informal crypto use Leading MENA region in blockchain adoption and fintech investment Growing interest in tokenized real estate and digital banking Strong fintech ecosystem with open banking and onchain finance integration High potential due to large unbanked population and mobile penetration Emerging interest in decentralized iden- tity and finance Focused on institutional use of blockchain for finance and compliance Onchain finance used for remittances and preserving wealth Initiatives Regulatory Stance Market Highlights