Amid the wave of crypto adoption, the National Bank of Cambodia (NBC) has allowed commercial banks and payment institutions to provide services related to Category 1 crypto assets in a new directive order.
Simply put, Cambodia-based banks and payment service providers are now authorized to provide certain stablecoin and cryptocurrency-related services. However, the authority is still blocking the use of unsecured and unbacked cryptocurrencies like Bitcoin.
???? ???????? National Bank of Cambodia allows institutions to pay in crypto!
This includes category 1 cryptocurrencies and asset-backed stablecoins. pic.twitter.com/PvSvS4hBJF
— CryptosRus (@CryptosR_Us) December 27, 2024
The new amendments and guidelines strive to regulate crypto ventures within the country. However, they need an approval from NBC. Only Institutions-approved authorization can allow them to provide crypto-related services, including exchanging crypto assets for fiat currencies or vice versa, transferring crypto assets between accounts, and providing custody services for crypto assets.
Also, banks or institutions can not use their customers’ crypto funds for their own purposes. This could be inspired by the U.S. bank failure in March 2023, when three banks with significant exposure to crypto-related activities crashed.
Recently, the demand for cryptocurrencies has skyrocketed after Donald Trump secured a remarkable victory in the presidential election race in 2024. Under his new administration, crypto enthusiasts around the globe are now expecting crypto-friendly policies.
Cambodian financial authority is taking a huge step, contrasting with their previous stance. Earlier, the country declared a blanket ban on cryptocurrency transactions and trading due to the associated high risks, including money laundering, fraud and illicit activities within the black market.