The National Bank of Cambodia has changed its approach to certain crypto assets, allowing limited operations. This change marks a new era for the country's financial sector.
Permissible Crypto Assets in Cambodia
Category 1 crypto assets permitted for operations do not include Bitcoin or Ethereum and are limited to fiat-backed and stablecoins like USDT, USDC, and Central Bank Digital Currencies. Any bank or payment institution wishing to offer such services must obtain permission from the National Bank of Cambodia.
Cambodia's Shift from Prohibition to Regulation
Previously, Cambodians were not allowed to engage in crypto transactions due to a ban on their use. Crypto assets were deemed too volatile and linked to criminal activity. However, the new decision marks a shift towards embracing the cryptocurrency industry, in line with global regulation trends.
Enforcing Regulatory Compliance
In December, Cambodia blocked several exchanges, including Coinbase and Binance, for failing to secure licenses. This move was in response to calls by the UN Office on Drugs and Crime to combat illegal activities linked to cryptocurrency. The state aims to ensure citizen safety amidst the growing popularity of digital assets.
The decision to regulate cryptocurrency operations in Cambodia signifies a key step towards advancing financial technology and strengthening oversight in this area. Despite some restrictions, the initiative is viewed as a positive shift, facilitating Cambodia's integration into the global financial community.
