DeFi usage in Yemen is rapidly increasing as citizens seek ways to manage money outside the reach of traditional financial institutions. According to a report by TRM Labs, decentralized finance platforms now account for over 63% of crypto-related traffic in the country. This shift is driven by necessity, not speculation, as U.S. sanctions and armed conflict continue to isolate Yemen from global banking systems.
Decentralized Finance Replaces Traditional Banks
TRM Labs notes that centralized exchanges make up only 18% of the crypto traffic in Yemen, while DeFi platforms have become the primary tool for value storage and transfers. With commercial banks often closed and financial infrastructure failing, Yemenis use DeFi apps to send and hold assets securely.
“Without access to banks, DeFi protocols have become the backbone of financial activity for many citizens,” the analysts explained.
The growth of DeFi usage in Yemen is closely linked to the collapse of conventional systems under prolonged war and international restrictions.
U.S. Sanctions Accelerate Crypto Adoption
The United States has imposed multiple rounds of financial sanctions on Yemen, targeting institutions such as the International Bank of Yemen. The most recent measures, introduced in April 2025, further limit international transactions.
These restrictions have encouraged residents to turn to crypto. With no legal framework in place, decentralized platforms offer the most accessible and reliable alternative to banks.
Legal Void Supports Unregulated Growth
Yemen lacks regulation over cryptocurrencies and digital finance. This legal absence allows for free DeFi adoption, but also raises concerns about fraud and abuse. TRM Labs believes that further sanctions could unintentionally expand crypto usage even more.
Despite past barriers such as low internet availability and limited digital literacy, more Yemenis are adopting DeFi platforms to gain financial independence.
