Cambodia

**Financial Regulatory Analyst Report: Retail Cryptocurrency Trading Status in Cambodia**

**Date:** April 13, 2025

**Topic:** Retail_Trading_Status

**Description:** Assessment of the legal permissibility for individual citizens and residents in Cambodia to buy, sell, and hold cryptocurrencies, including the relevant regulatory environment (e.g., KYC/AML requirements, warnings).

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**1. Identified Status:**

`Gray-Zone`

**2. Narrative Explanation:**

The status of retail cryptocurrency trading in Cambodia is best described as a `Gray-Zone`. While not explicitly illegal for individuals to invest their own funds, significant restrictions, bans on financial intermediaries, and recent regulatory actions create a complex and ambiguous environment that falls short of being either clearly allowed or outright banned.

*   **Historical Context and Institutional Ban:** Cambodia's authorities have historically maintained a highly cautious stance. A pivotal moment was a 2018 joint statement by the National Bank of Cambodia (NBC), the Securities and Exchange Commission of Cambodia (SECC - now SERC), and the General-Commissariat of National Police, which declared that "the propagation, circulation, buying, selling, trading and settlement of Crypto Currencies without obtaining license from competent authorities are illegal activities" [3, 6]. This was followed by a 2019 NBC directive effectively banning banks, financial institutions, and payment service providers from engaging in or facilitating any transactions related to cryptocurrencies [2, 10]. Critically, multiple analyses suggest this ban targeted the *intermediaries* (banks, payment processors) rather than explicitly prohibiting *individuals* from using their personal funds to invest in cryptocurrencies [2, 5, 10]. This created the initial ambiguity: individuals might not be legally barred, but the practical means of trading via regulated channels were shut down.

*   **Recent Regulatory Developments (Late 2024/Early 2025):** In late December 2024, the NBC issued a new directive (Prakas) introducing a regulatory framework for *certain* crypto assets [2, 7, 11]. This allows *licensed* commercial banks and payment service institutions (PSIs) to engage in activities involving "Group 1" crypto assets (defined as backed cryptocurrencies and stablecoins) [2, 7]. These activities include exchange for fiat, transfers, and custody, subject to NBC approval and strict conditions (e.g., prohibition on using client assets for own purposes) [2, 7, 11]. However, this directive explicitly *prohibits* these institutions from dealing with "Group 2" crypto assets, which include unbacked cryptocurrencies like Bitcoin [7, 11, 17]. Furthermore, the NBC governor reiterated as recently as January 2024 that the NBC "does not allow banking and financial institutions to conduct transactions related to crypto" to prevent risks, possibly referring to the ongoing prohibition for unbacked assets or unlicensed activities [8]. An April 2024 clarification from the NBC also stated it would not permit banks/financial institutions to deal with stablecoins like Tether (USDT) or USD Coin (USDC) as they did not meet its strict criteria, further limiting the scope of the December 2024 directive [12].

*   **Exchange Licensing and Blocking:** The Securities and Exchange Regulator of Cambodia (SERC) oversees digital asset licensing, primarily through its FinTech Regulatory Sandbox [5, 13]. Currently, very few entities (reportedly only two as of late 2024) have obtained licenses under this sandbox [5, 9, 16]. Importantly, these licensed entities face significant restrictions, including being barred from facilitating exchanges between digital assets and fiat currencies (like Cambodian Riel or USD) [9, 16]. Compounding this, in late 2024, the Telecommunication Regulator of Cambodia (TRC) blocked access to the websites of 16 prominent *unlicensed* international crypto exchanges (including Binance, Coinbase, OKX) for operating without SERC licenses [5, 9, 11, 16]. While some reports suggested mobile apps remained functional [5, 9], this action clearly signals regulatory intent to curb access to unlicensed platforms.

*   **Conclusion on Gray-Zone Status:** The situation is not an outright ban, as individuals are not explicitly forbidden from investing personal funds, and recent regulations permit *licensed* institutions to handle *specific, backed* crypto assets. However, it is far from `Allowed-Regulated` or `Allowed-Unregulated` for general retail trading. The ban on institutional facilitation of unbacked crypto transactions remains, access to major international (unlicensed) exchanges is actively being blocked, and the few licensed domestic platforms operate under severe limitations (no fiat exchange). Therefore, while retail participation might exist (Cambodia ranks relatively high in retail crypto usage [5, 9]), it operates in a restrictive environment without clear legal endorsement for popular assets like Bitcoin and faces significant practical hurdles imposed by regulators. The regulatory framework is still evolving, with the SERC reportedly working on comprehensive digital asset regulations [13, 19].

**3. Supporting Excerpts from Sources:**

*   **On the 2018 Joint Statement:** "Previously, the National Bank of Cambodia, the Securities and Exchange Commission of Cambodia and the General-Commissariat of National Police in Cambodia released a joint statement providing that “the propagation, circulation, buying, selling, trading and settlement of Crypto Currencies without obtaining license from competent authorities are illegal activities.”" (Source: Freeman Law [3])
*   **On the 2019 Institutional Ban vs. Individual Investment:** "In 2019, the central bank banned all forms of crypto currency transactions in the country. This ban was enforced through financial institutions and payment companies, but it does not prevent individuals from investing their money in cryptocurrency." (Source: Central Banking [2]; similar points in El Dorado [5], Standard Insights [10])
*   **On the Late 2024 NBC Directive (Allowing Specific Assets):** "For the first time, the National Bank of Cambodia (NBC) has allowed commercial banks and payment institutions to provide services involving Category 1 crypto assets, including backed or stable cryptocurrencies. However, unbacked cryptocurrencies, such as Bitcoin, remain prohibited." (Source: Phnom Penh Post [7]) / "The National Bank of Cambodia has given commercial banks and payment firms permission to provide crypto-related services, but not for Bitcoin and other unbacked tokens." (Source: Cointelegraph [11])
*   **On NBC's Continued Caution (Jan 2024):** "Chea Serey, Governor of the National Bank of Cambodia, stated yesterday that the National Bank of Cambodia does not allow banking and financial institutions to conduct transactions related to crypto to prevent risks to the public who may be vulnerable to fraud and loss." (Source: Khmer Times [8])
*   **On Exchange Blocking (Late 2024):** "Cambodia recently made headlines by banning access to numerous crypto exchanges, including some of the biggest names like Binance and Coinbase... Cambodia's Telecommunication Regulator (TRC) blocked access to 16 prominent crypto exchange websites... citing a lack of licenses from the Securities and Exchange Regulator of Cambodia (SERC)." (Source: El Dorado [5]) / "The Telecommunication Regulator of Cambodia (TRC) moved to block access to 16 cryptocurrency exchanges, among them Binance, Coinbase, and OKX. The TRC said that it implemented the restrictions because the platforms are not properly licensed by the Securities and Exchange Regulator of Cambodia (SERC)." (Source: Kapronasia [16])
*   **On Licensed Sandbox Entity Restrictions:** "Currently, only two companies in Cambodia have received authorization under SERC's FinTech Regulatory Sandbox program. These licensed entities can trade digital assets but face restrictions on exchanges involving the country's legal tender – the riel and US dollars – or other fiat currencies." (Source: Kapronasia [16]; similar point in Digital Watch Observatory [9])
*   **On Ongoing Regulatory Development:** "The Securities and Exchange Regulator of Cambodia (SERC) is collaborating with the Asian Development Bank (ADB) to establish a regulatory framework for digital assets in the country." (Source: Khmer Times [19]) / SERC plans include: "Develop regulation framework for digital assets, peer-to-peer financing" (Source: B2B Cambodia [13])

**4. Source URLs:**

*   [2] Central Banking (Jan 3, 2025): `https://www.centralbanking.com/fintech/crypto/7960076/cambodia-allows-banks-to-handle-stablecoins-and-backed-cryptos` (Via Google Search Grounding API)
*   [3] Freeman Law (Undated, accessed Apr 2025): `https://freemanlaw.com/cambodia-cryptocurrency/` (Via Google Search Grounding API)
*   [5] El Dorado (Undated, likely late 2024/early 2025): `https://blog.eldorado.gg/cambodias-crypto-exchange-ban-what-comes-next/` (Via Google Search Grounding API)
*   [6] National Bank of Cambodia (July 13, 2018): `https://www.nbc.gov.kh/english/news_and_events/news_info.php?id=378` (Via Google Search Grounding API - Note: Direct link might require navigation from main site if session-based)
*   [7] Phnom Penh Post (Dec 27, 2024): `https://www.phnompenhpost.com/business/regulated-cryptocurrency-assets-approved-operation-cambodia` (Via Google Search Grounding API)
*   [8] Khmer Times (Jan 30, 2024): `https://www.khmertimeskh.com/501431840/national-bank-of-cambodia-does-not-allow-banking-and-financial-institutions-to-conduct-crypto-transactions-to-prevent-risks-to-public/` (Via Google Search Grounding API)
*   [9] Digital Watch Observatory (Dec 4, 2024): `https://dig.watch/updates/cambodia-blocks-binance-and-coinbase-in-crypto-crackdown` (Via Google Search Grounding API)
*   [10] Standard Insights (Dec 28, 2022): `https://standardinsights.io/blog/cryptocurrency-in-cambodia/` (Via Google Search Grounding API)
*   [11] Cointelegraph (Dec 27, 2024): `https://cointelegraph.com/news/national-bank-of-cambodia-allow-banks-process-cryptocurrencies` (Via Google Search Grounding API)
*   [12] Khmer Times (Apr 5, 2024): `https://www.khmertimeskh.com/501466218/forbidden-crypto-nbc-clarifies-why-it-cannot-allow-banks-to-handle-transactions-associated-with-cryptocurrencies/` (Via Google Search Grounding API)
*   [13] B2B Cambodia (July 2, 2024): `https://www.b2b-cambodia.com/news/securities-and-exchange-regulator-of-cambodia-shares-vision-for-2024-2028-and-beyond/` (Via Google Search Grounding API)
*   [16] Kapronasia (Dec 7, 2024): `https://www.kapronasia.com/research/why-is-cambodia-cracking-down-on-crypto/` (Via Google Search Grounding API)
*   [17] B2B Cambodia (Aug 8, 2024): `https://www.b2b-cambodia.com/news/overseeing-the-benefits-and-regulations-of-digital-assets-in-cambodia/` (Via Google Search Grounding API)
*   [19] Khmer Times (Feb 13, 2025): `https://www.khmertimeskh.com/501614528/cambodia-seeks-adb-support-for-digital-asset-regulation/` (Via Google Search Grounding API)

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**End of Report**