For the first time, Cambodia’s central bank has authorised commercial banks and payment institutions to provide services involving stable cryptocurrencies, marking a significant step towards integrating digital assets into the country’s financial system.

A directive issued on December 26 permits approved institutions to offer services such as cryptocurrency-to-fiat currency exchanges, asset transfers, and custody services. However, unbacked cryptocurrencies like Bitcoin remain banned due to concerns over volatility and financial crime risks.

Institutions must seek approval from the National Bank of Cambodia before offering crypto services and are prohibited from using customer-held crypto assets for their own purposes.

This regulatory shift reflects Cambodia's effort to align with global financial trends while mitigating risks associated with digital assets. Experts suggest that the move could enable revenue generation for financial institutions while maintaining regulatory oversight and consumer protection.

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