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The provision of cryptocurrency services by commercial banks and payment institutions has been formally approved by the National Bank of Cambodia (NBC). In line with the bank’s mission to promote a stable financial ecosystem, these services concentrate on stablecoins and other digital assets backed by safe deposits. Bitcoin and other unbacked cryptocurrencies are still prohibited by NBC, though.
Financial institutions that want to do anything involving cryptocurrencies must first get NBC’s consent. Transferring cryptocurrencies between accounts, providing custody solutions, and converting digital assets to fiat currencies and vice versa are all examples of approved services. Institutions are not allowed to use customer-held bitcoin assets for their own operations in order to protect their clients.
In tandem with these developments, Cambodia has intensified its crackdown on unregulated cryptocurrency exchanges. Authorities recently blocked 16 major exchange websites, including well-known platforms like Binance, Coinbase, and OKX. This action reflects the government’s commitment to reducing risks like money laundering and fraud, which are often linked to unregulated platforms.
The crackdown extends beyond cryptocurrency exchanges. The Telecommunication Regulator of Cambodia (TRC) also blocked access to 102 websites primarily associated with online gambling. However, enforcement faces challenges as mobile applications for these banned platforms remain accessible.
Despite these strict measures, Cambodia is emerging as a leader in per capita retail cryptocurrency adoption, according to a report by Chainalysis. This demonstrates the public’s significant interest in digital assets, even as authorities impose stringent controls.
The introduction of regulated cryptocurrency services through banks and payment institutions could mark a turning point. These regulated channels promise a safer and more compliant environment for users, potentially increasing adoption while ensuring market stability.