Crypto Adoption Around the World: Lebanon

Economic Situation In Lebanon

Source: Envato

Lebanon has been going through one of the worst economic crises seen anywhere in the world since the mid-19th century. Starting in 2019, the country’s economy began falling apart, compounded by COVID-19 and the massive Beirut port explosion in 2020.

The following are some of the most severe problems arising in Lebanon:

• The Lebanese currency has lost almost all of its value (98%) since 2019.
• Prices shot up dramatically, with inflation reaching triple digits.
• Almost 80% of people living in Lebanon have fallen into poverty.
• Basic services like electricity became unreliable.
• The banking system effectively collapsed, locking depositors out of their funds.

As of 2025, the situation remains challenging but shows signs of a “fragile stabilization”. After a cumulative real GDP decline of nearly 40% since 2019 (including a 7.1% contraction in 2024), real GDP is projected to grow by 4.7% in 2025. 

This partial rebound is supported by strong diaspora tourism. Inflation is also projected to moderate to 15.2% in 2025, assuming continued exchange rate stability.

Despite this, the IMF notes that “structural weaknesses” remain and the “unresolved financial crisis” continues to impede recovery. 

This is where cryptocurrency became important for many Lebanese people. Even though the central bank does not officially allow it, many turned to crypto to protect their money and make payments.

The State of Crypto Adoption in Lebanon

When the banks failed and people couldn’t access their money, many Lebanese people turned to Bitcoin cryptocurrencies as a solution.

According to Statista, the number of users is growing. In 2025, user penetration is projected to be 7.07%, with the total number of users expected to reach 430,800 by 2026. The total revenue in the crypto market is projected at US$7.0m in 2025, with an average revenue per user of US$16.9.

Some of the ways the Lebanese are using crypto in practical ways include, but are not limited to:

• Protect their savings from the country’s high inflation and currency devaluation.
• Exchange crypto for US dollars to buy basic needs like groceries.
• Many have even started mining crypto or doing online freelance work paid in cryptocurrency to earn a living.

The banking crisis has been so bad that people have protested and even destroyed ATMs. Interestingly, warnings from former Central Bank governor Riad Salameh about crypto’s risks seemed to have had the opposite effect. Given the bank’s failure to protect people’s savings, many Lebanese saw this as a reason to trust crypto more.

Crypto Law In Lebanon

The Lebanese government has had a restrictive and cautious stance on cryptocurrencies since 2013. 

That year, the central bank, Banque du Liban (BDL), became the first in the Middle East to issue a warning to banks and financial institutions about the risks of “virtual money,” including volatility, criminal use, and the lack of legal protection.

In 2018, the BDL issued a partial ban prohibiting financial institutions and exchanges from issuing, advertising, or trading “electronic currencies”. Lebanon’s Capital Markets Authority (CMA) also banned financial institutions from dealing with cryptocurrencies, citing:

• The absence of laws controlling crypto platforms.
• The lack of guarantees for users or central bank backing.
• Concerns about use in illegal activities including money laundering or terrorism funding.
• The fact that transactions in crypto are irreversible.

This has created a “legal grey zone”. While institutions are banned, the laws do not explicitly prohibit individuals from owning, using, or trading cryptocurrencies. The 2018 Electronic Transactions and Personal Data Law introduced a vague term “digital and electronic money“, but this has not clarified the situation.

As of June 2025, Lebanon’s robust anti-money laundering (AML) framework does not yet have a “fully established framework” for Virtual Asset Service Providers (VASPs). This is noted as an area “still in development,” with the BDL and the Special Investigation Commission (SIC) “scrutinizing this matter”.

Challenges to Crypto Adoption in Lebanon

Source: Envato

Crypto adoption in Lebanon faces several challenges:

1. Regulatory Uncertainty: The BDL’s restrictive stance and the “legal grey zone”  create volatility and uncertainty. Users operate without a “regulatory shield” or legal recourse.
2. Economic Instability: While the crisis drives adoption, the “fragile stabilization” and “structural weaknesses”  of the economy create a difficult operating environment.
3. Lack of Legal Framework: The absence of a comprehensive framework for VASPs leaves gaps in consumer protection, taxation, and legal recognition.
4. Inherent Crypto Risks: Users are exposed to high volatility, the danger of security breaches at exchanges, and the irreversibility of transactions, which makes theft or loss permanent.
5. Technological Barriers: Limited technological infrastructure and digital literacy can hinder widespread adoption.
6. Public Trust: Distrust in traditional banking systems drives some towards cryptocurrencies, but overall public awareness and trust in digital currencies remain low.

Potential Benefits of Crypto Adoption in Lebanon

Crypto adoption in Lebanon presents several potential benefits, especially given the country’s current economic challenges:

1. Financial Inclusion: Cryptocurrencies can provide access to financial services for those who are unbanked or underbanked, offering a lifeline in a country with an unstable banking system.
2. Hedge Against Inflation: In an environment of hyperinflation, cryptocurrencies, particularly stablecoins, can serve as a store of value, protecting savings from devaluation.
3. Remittances: Cryptocurrencies offer a faster and cheaper alternative for sending and receiving remittances, which is crucial for many Lebanese families reliant on money from abroad.
4. Economic Empowerment: By embracing decentralized finance (DeFi) and blockchain technology, individuals can gain greater control over their finances, fostering economic independence.
5. Innovation and Entrepreneurship: The crypto sector can stimulate innovation, leading to the development of new businesses, job creation, and technological advancements.

Conclusion

With the Lebanese banking system in shambles and the local currency plummeting in value, cryptocurrencies have provided a way for Lebanese citizens to protect their savings, make payments, and even earn a living. 

While the government has taken a cautious and restrictive approach to regulating crypto, the practical need for alternative financial solutions has driven growing adoption. 

As the crisis continues, cryptocurrency could play an increasingly crucial role in helping the Lebanese people weather the economic storm.