It is a new era for digital finance in Cambodia as the country’s national bank has shifted stance on certain classes of crypto assets. According to local news source , the National Bank of Cambodia (NBC) has given commercial banks and other payment institutions the green light to provide Category 1 crypto services. The shift in stance followed formalization of a ministerial decision (prakas) issued on Boxing Day and announced by the NBC. A move many have come to term as the country’s “gift” to improving the financial sector. Permissible Crypto Assets in Cambodia Notably, the category 1 crypto assets do not include adoption of Bitcoin , Ethereum or any of such unbacked cryptocurrencies. The green light is only for crypto assets backed by fiat and stablecoins like USDT, USDC and other Central Bank Digital Currencies (CBDCs) Following this approval, any commercial bank interested in offering crypto-based services must get clearance from NBC. If authorized to proceed, such commercial banks or payment institutions can then engage in crypto asset exchanges. That is, they can swap fiat currency for crypto assets, provide custodial services for crypto assets and transfer of assets between accounts. This approval comes with a prohibitory clause. The NBC does not allow for the financial institutions to use their customers’ crypto assets for their own benefit. Cambodia’s Shift from Prohibition to Regulation Prior to the decision and NBC’s announcement, citizens of Cambodia were forbidden from engaging in crypto transactions. The Southeast Asian country also prevented any form of trading activities using crypto as the authorities generally considered digital assets too volatile. Additionally, crypto assets were seen as enabling criminal activities including fraud and money laundering in the black market. Thus, the development marks a notable shift towards embracing the cryptocurrency industry. Although Cambodia is still in the early stages of liberalization, market watchers are accepting it as a move in the right direction. The country now joins the global trend gaining traction in the UAE and Hong Kong . Enforcing Regulatory Compliance Cambodia at the beginning of December blocked some crypto exchanges from operation for failure to secure a license. The exchanges included known names like Coinbase, Binance, OKX among others. Notably, only their websites were blocked leaving just the apps. The move became necessary following the United Nations Office on Drugs and Crime (UNODC) calls for a crackdown on illicit activities in the Southeast region. Masood Karimipour, UNODC’s regional representative, enjoined governments in the region including Cambodia to curb criminal activities linked to crypto. The post Cambodia Gives Green Light to Regulated Crypto Assets appeared first on TheCoinrise.com .
