Quick Answer
Yes, crypto is legal in Cambodia with a license.
- A 2024 regulation allows licensed banks and companies to offer crypto services.
- All crypto activities are subject to strict AML/CFT compliance and NBC oversight.
Legal Status of Crypto in Cambodia
The legal status of cryptocurrency in Cambodia has shifted from a prohibited gray area to a regulated field, making it legal for entities that secure the proper licensing. This change was driven by a late 2024 regulation from the National Bank of Cambodia (NBC) that created a formal framework for cryptoasset services. While this opens the door for banks and other firms, all operations are closely supervised by the NBC and must follow strict AML/CFT compliance requirements enforced by the Cambodia Financial Intelligence Unit (CAFIU).
Current Regulations
The current regulatory landscape is defined by Prakas B7-024-735 Prokor, a late 2024 regulation from the National Bank of Cambodia (NBC). This framework permits commercial banks and other legal entities to provide cryptoasset services after obtaining prior approval or a license from the NBC. The rules distinguish between asset types, allowing banks to hold tokenized assets and stablecoins for their own accounts but banning direct exposure to unbacked cryptocurrencies. While direct bank engagement is limited, approved institutions may be able to offer services like custody and trading to clients, signaling a major shift from the country's previous stance.
Regulatory Authorities
Several key governmental bodies are responsible for the oversight and enforcement of cryptocurrency regulations in Cambodia.
- National Bank of Cambodia (NBC): The NBC is the primary regulator responsible for issuing the Prakas on cryptoassets and granting licenses to banks and other firms to provide crypto services. It also sets prudential requirements and supervises all licensed entities to ensure they comply with the new framework.
- Securities and Exchange Regulator of Cambodia (SERC): As a co-issuer of the 2018 joint statement that initially prohibited unlicensed crypto, the SERC maintains oversight of cryptoassets that qualify as securities. Its involvement is crucial for regulating tokenized financial instruments under the new legal framework.
- General-Commissariat of National Police: This body is tasked with law enforcement, investigating and penalizing any unlicensed crypto activities that are considered illegal under Cambodian law. It was also a party to the 2018 joint statement that warned against unregulated crypto trading.
- Cambodia Financial Intelligence Unit (CAFIU): CAFIU is the central authority for enforcing the country's Anti-Money Laundering and Combating the Financing of Terrorism (AML/CFT) laws. All licensed crypto firms must comply with its mandates, including conducting customer due diligence and reporting suspicious transactions.
Historical Context
Cambodia's crypto regulation began with a strict prohibition. In 2018, a joint statement from the National Bank of Cambodia (NBC), the securities regulator, and national police banned all unlicensed crypto activities, creating a restrictive environment. The landscape shifted dramatically in late 2024 with the introduction of Prakas B7-024-735 Prokor. This new regulation moved from a blanket ban to a permission-based system. By early 2025, the rules allowed commercial banks and licensed firms to offer cryptoasset services with prior NBC approval. While banks face restrictions, this more permissive stance opened the door for a regulated market.
Compliance Requirements for Businesses in Cambodia
Businesses in Cambodia, particularly those involved with financial transactions, must navigate a stringent regulatory environment designed to combat financial crime. The core of these obligations is outlined in the Law on Anti-Money Laundering and Combating the Financing of Terrorism (AML/CFT). Here are the essential compliance requirements:
- AML/CFT Checks: The primary legal framework requires businesses to implement comprehensive AML checks. This involves diligent supervision of financial transactions to deter, prevent, and suppress money laundering and terrorism financing. Failure to comply can lead to significant fines and even criminal charges.
- Customer Due Diligence (CDD) and KYC: A cornerstone of Cambodian compliance is the mandatory requirement to conduct Customer Due Diligence (CDD) on all clients, as stipulated in Article 8 of the AML/CFT Law. This process, which includes Know Your Customer (KYC) procedures, involves identifying and verifying a client's identity, understanding the nature of the business relationship, and applying enhanced due diligence for higher-risk situations.
- Suspicious Transaction Reporting (STR): Businesses are legally obligated to report any suspicious activities or transactions to the Cambodia Financial Intelligence Unit (CAFIU). The government provides specific guidelines and directives detailing the procedures and timelines for submitting these reports.
- Internal Controls and Compliance Officer: Companies must establish robust internal policies and controls. This includes the mandatory appointment of a Money Laundering Compliance Officer, as required by Article 16 of the AML/CFT Law, to oversee the compliance program.
- Record-Keeping: Article 11 of the AML/CFT Law mandates that businesses maintain accurate and comprehensive records of customer identification data, transactions, and all due diligence activities. These records must be kept for a specified period (often five years or more) and be readily available for inspection by competent authorities.
- Staff Training: A key component of a strong compliance program is ongoing staff training. Businesses are expected to continuously educate their teams on the latest AML regulations, internal procedures, and how to identify and report suspicious activities.
- Risk Assessment: Reporting entities must conduct their own risk assessments to identify, assess, and mitigate money laundering and terrorist financing risks. These assessments should consider customer profiles, products, services, and geographical factors, aligning with national risk assessments and sector-specific guidelines.
Why this matters for Cross-Border Payments
For businesses managing cross-border payments between Cambodia and India, these stringent regulations introduce significant compliance hurdles. The mandatory Customer Due Diligence (CDD) and Suspicious Transaction Reporting (STR) requirements mean that every transaction faces heightened scrutiny from Cambodian authorities. This can create operational pain points, including potential payment delays, increased administrative costs, and a greater risk of funds being frozen pending investigation if documentation is not perfectly aligned with Cambodia's strict AML/CFT framework.
How Lightspark Enables Compliant Crypto-Native Payments
Lightspark provides infrastructure for instant, global payments through its "Money Grid," built on Bitcoin. Its core products, Lightspark Connect and Grid Switch, address key payment friction. Connect enables native Bitcoin transfers by managing complex operations like liquidity and routing. Grid Switch facilitates fiat-to-fiat cross-border payments by using domestic real-time payment systems, with the Lightning Network acting as a swift settlement layer. This combination allows for instant, low-cost transactions, bypassing the delays and high fees of traditional correspondent banking.
For regulated institutions navigating Cambodia's strict AML/CFT rules, Lightspark provides tools to aid compliance. The platform offers features like audit-ready reporting, flexible custody options, and integrations with compliance-focused protocols like Universal Money Address (UMA). These capabilities don't handle compliance directly but equip businesses with the necessary infrastructure to manage their own regulatory obligations, such as customer due diligence and transaction monitoring, more effectively within a crypto-native payment environment.
To learn more about how Lightspark facilitates compliant, crypto-native payments, visit the Lightspark website.
Notice: This article is provided for informational purposes only and does not constitute legal advice.
Sources
- Cambodia Financial Intelligence Unit. "Laws and Regulations." CAFIU, cafiu.nbc.gov.kh/en/laws-and-regulations/.
- Freeman Law. "Cambodia and Cryptocurrency | Blockchain and Cryptocurrency Regulations." Freeman Law, 2022, freemanlaw.com/cryptocurrency/cambodia/.
- Ledger Insights. "Cambodia Issues Bank Rules for Digital Assets. Is It Relaxing Crypto Stance?" Ledger Insights, 6 Jan. 2025, www.ledgerinsights.com/cambodia-issues-bank-rules-for-digital-assets-is-it-relaxing-crypto-stance/.
- Piseth, Panha, et al. "Strengthening Business Integrity Through AML/CFT Compliance in Cambodia." SokSiphana & Associates, 18 Sep. 2024, www.soksiphana.com/resources/alerts/strengthening-business-integrity-through-aml-cft-compliance-in-cambodia/.
- Sreng, Nearirath, and Vansok Khem. "Cryptoassets Regulation Introduced by the National Bank of Cambodia (“NBC”)." DFDL, 17 Jan. 2025, www.dfdl.com/insights/legal-and-tax-updates/cryptoassets-regulation-introduced-by-the-national-bank-of-cambodia-nbc/.
