Cambodia has introduced a new regulation regarding the crypto sector. Investors are required to seek authorization to trade legal cryptocurrencies. Otherwise, it’s “illegal“.
According to a joint statement signed on May 11 and shared on 19th June, the National Bank of Cambodia (NBC), the Securities and Exchange Commission of Cambodia and the General Commissariat of National Police have specified that the decision was taken as a result of the growing demand for crypto investments in the country.
The document describes that the activities “will cause potential risks to the publics [sic] and society as a whole,” adding that: “Competent authorities clarify that the propagation, circulation, buying, selling, trading and settlement of cryptocurrencies without obtaining license from competent authorities are illegal activities.”
If investors fail to obtain the license: they get a penalization
Please note that if investors fail to get the license, they “shall be penalized in accordance with applicable laws.” The imposed obligation was argued by the three institutions involved by referring to the high risk of investments in cryptocurrencies because of high volatility, cryptojacking, money laundering, identity theft, but also the loss of citizens’ trust in the technological environment.
Even so, the institutions did not specify what kind of license should be requested in order to buy, store and sell cryptocurrencies, nor what are the criteria for an application to be approved.
The joint statement also referred to the latest legislative changes in December 2017, when NBC banned all financial institutions from offering crypto services to both investors and traders, according to Phnom Penh Post‘s report.
Regardless of this restriction, crypto-based projects have continued to develop in a gray environment, as legal institutions had yet to communicate a legal framework offering secure and clear information about the crypto sector and what it involves.