Summary
- Yemen remains in a state of civil war, with Houthi rebels in administrative and physical control of the capital Sana’a and the north-west of the country (where almost 70% of the population live) while the recognized government controls the rest of the country.
- Crypto adoption has had a difficult history in Yemen. Used by Houthis as a form of currency and means to avoid international sanctions, the past year has seen the roots of DeFi taking hold as ordinary citizens grapple with severe economic problems.
- For the crypto and blockchain sector to develop healthily, at least three key factors must be addressed – robust legislation, financial education and literacy, and transparency.
- For more stories on crypto adoption in countries worldwide, visit our Crypto in Action pages.
How crypto is used in Yemen
In the 2025 crypto adoption index, Yemen was ranked 12th globally. For a country in the 11th year of civil war, this is perhaps surprising, but several factors are contributing to this growth.
During 2025, DeFi platforms suddenly accounted for 63% of the country’s crypto web traffic. The situation is not wholly clear but it appears that the country’s citizens are increasingly looking to DeFi options as a banking option. With what’s left of the country’s banking infrastructure in disarray and US sanctions aimed at the Houthis affecting ordinary citizens, DeFi is offering a possible solution.
Historically, there has been little opportunity to get involved in the crypto and blockchain sector. It has been the domain of the Iran-backed Houthi rebels, who have developed their own cryptocurrency and mined crypto to fund their continuing insurgency. The group has also secured a stronghold over the telecommunications network, which provides them with intelligence as well as gives them a means to censor information. They’ve kept a close eye on any civilian users of cryptocurrency, with this and the attendant threat of coercion deterring most Yemenis.
In addition, the country’s lacking and damaged infrastructure has posed an additional challenge. Added to this, levels of financial literacy are low, and numbers of unbanked are high. In 2014 (the last time figures were available), those over the age of 14 who had a bank account comprised just 6.45% of the population.
As a result, Yemen remains a largely cash-reliant economy. There is some use of P2P networks to support cross-border payments, including remittances, but not on the scale witnessed elsewhere.
Reports suggest there is domestic interest in cryptocurrencies but currently the framework to support the healthy development of the sector is notably lacking. Those who have pursued crypto interests have reportedly pooled resources and knowledge to create their own networks to support access, while others have used the knowledge and contacts of the country’s diaspora.
The authorities’ attitude to crypto
Yemen is war torn, effectively split between two competing entities. As such, crypto and blockchain development receives very little serious interest. Attempts have been made to disrupt this avenue of Houthi financing. In December 2024, the US updated the sanctions designation of an Iranian-based financier, Sa’id al-Jamal, to include five cryptocurrency addresses that belonged to him.
The government, meanwhile, has sought to dampen any interest in crypto. In June 2024, the Central Bank of Yemen (CBY) prohibited dealings with unlicensed entities, wallets, and electronic payment services.
Currently, there is no indication of any interest in or ability to create legislation to govern the sector.
Timeline of developments
2021
The Houthi’s began preparations for the creation of a digital rial, a new currency that they announced would be used locally.
2024
In June, the central bank issued a circular prohibiting dealings with unlicensed entities, wallets, and electronic payment services.
Outlook for adoption to remain limited
Crypto adoption among Yemeni citizens is expected to continue to be limited. There are too many challenges to broad adoption.
Crypto could offer support to a war-torn nation and is something that aid agencies have sought to develop. Initiatives have reportedly been developed to support the infrastructure required to use cryptocurrencies, provide education in safe cryptocurrency usage, and support the provision of the technology required to access the market. But, there are many other areas in which aid agencies have work to do and much of their work in Yemen focuses on critical aid delivery, again reducing the interest in and scope for crypto, technology and financial literacy development.
Oversight will remain a major issue. There appears no appetite for legislation or a shift towards the creation of a transparent system that seeks to protect the user. Nor is this likely to materialize while Houthi rebels continue to rely heavily on crypto because it’s simply not in their interests.
As such, Yemen’s crypto development will remain stunted and challenging, with absolute need underpinning its growth.
