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Morocco Enters The Crypto Adoption Race

Morocco Enters The Crypto Adoption Race


04 Nov 2022

There’s a nationwide ban on digital assets in Morocco, but the cryptocurrency industry continues to rise.

The country is 14th in crypto adoption worldwide and second to Nigeria in Africa. It has become an emerging market for grassroots adoption, according to the 2022 Global Crypto Adoption Index of Chainanalysis.

In a low-income country like Morocco, users benefit from remittances that are faster and cheaper. Crypto paves the way to preserve the value of savings amid the ongoing fluctuations of conventional currencies. But what does this mean for a country that considers crypto trading illegal?

Below, we’ll explore the different factors driving the growing adoption of crypto in Morocco and what lies ahead for this emerging market.

Morocco’s Cautious Stance on Cryptocurrency

Cryptocurrency is currently illegal in Morocco. However, the country’s central bank, Bank Al-Maghrib (BAM) is open to regulating the industry instead. BAM has expressed plans to issue its central bank currency, indicating a cautious but amenable stance on digital assets.

Despite the illegal status of crypto in the country, the rising trend in crypto adoption could pave the way for friendlier laws and regulations. This is echoed by the Moroccan Institute for Policy Analysis (MIPA), which stated that the country is taking a “wait and see” stance.

Despite the merits of decentralized finance, MIPA maintains that legalizing crypto could diminish the country’s control over economic and monetary sovereignty.

A growing worry in the banking sector is the decentralized nature of crypto. The lack of a regulatory framework means that there are more risks and weaker protection for consumers.

Additionally, little to no control over capital flight is also a big concern as blockchain transactions transcend geographical boundaries. But despite these concerns, BAM is set to meet with the International Monetary Fund (IMF) and other countries to gain insight into how other early adopters are regulating the industry and adopting sound policies to mitigate risk.

Rising Crypto Adoption in Morocco

Despite a stagnating global crypto market and a nationwide ban on crypto, ownership is on a steady rise in the country. DataPortal reports that user adoption grew from 2.4 percent in 2021 to 3.1 percent in 2022.

An estimated 2.4 percent of Moroccans, accounting for 0.9 million people, own cryptocurrency, a majority of which are males aged between 16 and 44. Peer-to-peer trading volumes have reached US$ 6 million, the highest in North Africa.

Below are the key factors driving this growth in popularity:

Underbanked Population

Morocco is one of the most underbanked countries in North Africa and worldwide. The World Bank reported that only 29 percent of Moroccan adults own bank accounts. For context, the regional average in the Middle East and North Africa is 44 percent.

A study published in The Guardian revealed that many Moroccans, particularly low-income earners, are intimidated by banks and conventional financial institutions. Locals have expressed distrust in banks due to rampant fraud and robbery, which authorities have yet to address.


Also from The Guardian report, a local banking official named Ismail Douiri noted that Moroccans would rather keep cash at home. Privacy and confidentiality are also big concerns, as many Moroccans feared that neighbors would borrow money if they knew they had a bank account.

That said, blockchain technology offers a more discrete alternative as it allows people to conduct financial transactions online. You don’t need to visit a physical branch to open an account or procure documents from government institutions.

Quicker Remittances

Remittances are one of the biggest sources of foreign currency inflows for the North African country. In 2022 alone, remittances from Moroccan diaspora groups accounted for 5.8% of the country's Gross Domestic Product (DDP). The overseas Moroccan community consists of over five million people, creating a huge cryptocurrency market.

This trend is consistent among Morocco’s neighbors like Kenya and Nigeria. But it’s also seen in nations whose economies rely on remittance flows from migrant workers, like the Philippines, Vietnam, and India, which top the list of crypto adopters. Decentralized finance allows migrant workers to send money to their loved ones conveniently and cost-effectively.

A Promising Future For Moroccans

The Middle East and North Africa (MENA) region is currently the fastest-growing crypto market. Crypto adoption appears to be faster in countries that experience fiat currency volatility and those that rely on crypto to send remittances to loved ones, among other use cases.

While regulatory restrictions impede the growth of crypto in these countries, grassroots adoption has been an unstoppable force. If Morocco maintains this momentum, the country’s financial institutions may consider easing restrictions, indicating a brighter future for crypto in the country.

Following the 2020 cryptocurrency boom, the growth of the market has been sporadic. But emerging markets like Morocco have played a huge role in keeping crypto adoption steady despite widespread price declines. This is largely due to the tangible benefits that crypto provides for users living in unstable economic conditions.

For many people, cryptocurrencies and decentralized finance have given them access to financial services they wouldn’t have received from traditional financial institutions. Institutions like banks and lenders tend to have stricter requirements. Many unbanked individuals can't meet such requirements or live in locations that have granted them access to these services.

Cryptocurrency, on the other hand, allows you to access financial services and participate in wealth-building activities like trading and GameFi by simply having a smartphone and Internet connection.

Morocco is fast becoming a leader in cryptocurrency usage in Africa. But improved regulations and policies could accelerate the adoption of digital assets in emerging markets and worldwide. It is interesting to see how the industry will pivot and innovate to address these sticking points. Without a doubt, Moroccans have benefited from cryptocurrency, and the possibilities are endless should the regulatory environment improve.

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