Cambodia is blocking web access for 16 major cryptocurrency exchanges to combat crypto crimes.
In an effort to regulate the crypto market, Cambodia has blocked access to sixteen major crypto exchanges, including Binance, OKX and Coinbase. Nikkei Asia reported that the exchanges failed to secure licenses from Cambodia’s Securities and Exchange Regulator, which is necessary for operating in the country.
The ban is placed across 102 domains, among which most are related to online gambling tied to crypto exchanges by the Telecommunications Regulator of Cambodia on Nov. 20. These exchanges are reported to be operating without the proper licenses and authorizations required by Cambodian law. While the websites are placed under the ban, mobile applications are still functional.
This ban might be put in place to cater to the growing population of digital asset users in the country, which is expected to rake around $8 million in 2024, according to Statista. The Digital Assets market in Cambodia will reach $8,031,000 in revenue in the next year, although growth is anticipated to taper off through 2025.
Regulatory background and context
Binance, one of the blacklisted exchanges in Cambodia, has held a long relationship with the country since signing a memorandum of understanding with the SERC aimed at creating digital currency regulations in 2022.
Additionally, the company partnered with the Royal Group, a significant business conglomerate in Cambodia, to add force to blockchain adoption and also trained the country’s Interior Ministry officials in Jun. 2023 on detecting crypto-related crimes. Despite these efforts, the largest cryptocurrency exchange in terms of trading volume has been debarred. “We are closely monitoring the evolving situation,” said Binance spokesperson Lily Lee in relation to the ban.
Exchanges are required to be licensed under SERC’s FinTech Regulatory Sandbox, a controlled group program that is subordinated to the Non-bank Financial Services Authority of Cambodia. At present, two companies are licensed to trade digital assets, however, without the ability to exchange the assets for KHR, the official currency or U.S. dollars, the crypto landscape is close to being ineffective.
The current and future outlook for digital assets in Cambodia
As previously reported by crypto.news, crypto-related scams have been on the rise in Cambodia. According to UNODC, these groups are more active on the dark web, using cryptocurrencies as a form of payment to launder money and take part in illicit activities. Furthermore, Huione Guarantee, a crypto-led platform used by cybercriminals in Southeast Asia, is also linked to Cambodian conglomerate Huione Group, as per Chainalysis.
As established in the Cambodia Fintech Development Policy, the country’s digital assets arena is likely to take shape in the next few years and become more organized under the Royal Government’s focus on creating a comprehensive regulatory framework on the digital assets and decentralized finance systems, could help the country tackle financial crimes as a whole.
