Cambodian regulators set out plans for virtual asset oversight

Cambodian financial regulators have indicated they are preparing a regulatory framework for virtual assets, including cryptocurrencies.

A joint notice issued on September 23 by the Securities and Exchange Regulator of Cambodia (SERC) and the National Bank of Cambodia (NBC) said the rapidly expanding market could create macroeconomic risks, consumer protection concerns and money laundering threats.

Risks and scope

The notice, titled Regulation of Virtual Assets and Virtual Asset Service Providers, said regulators have observed fast development in the sector and its growing use for speculative investment as well as payment for goods and services.

It described virtual assets as digital forms of value that depend chiefly on cryptographic techniques and distributed ledger or comparable technology. They may be transferred or traded online and used for payment or investment purposes.

Both institutions also pointed to broader policy concerns, including tax evasion and cybercrime.

Earlier warnings

A 2018 joint statement involving SERC, NBC and the General Commissariat of National Police had already warned that individuals or companies trading in cryptocurrencies without the required licence from competent authorities could face penalties under applicable laws.

The latest notice said risks have grown as adoption rises worldwide, virtual assets operate across borders and become more connected to the mainstream financial system.

That environment, it added, calls for a cohesive, consistent and coordinated regulatory response.

Proposed framework

The regulators said effective rules could improve transparency in financial markets, broaden access to financial services, support economic empowerment and contribute to public revenues.

They proposed a harmonised approach based on three principles: investor and consumer protection, market integrity and support for innovation.

Under the plans, licensed commercial banks that want to offer customers services connected with virtual asset use must first obtain approval from NBC.

Legal entities other than commercial banks that are already licensed by NBC must obtain a licence from SERC in advance.

Coordination and public caution

SERC and NBC said they would work together on coordination mechanisms as the market develops, with periodic reviews of that cooperation.

The two bodies also reminded the public that virtual assets are not legal tender under Cambodian law and are not guaranteed by the government or central bank.

They warned that digital assets can be highly volatile and carry substantial risks, urging the public to carefully assess any exposure and make informed investment decisions.