NBC Issues Prakas for Cryptoasset Transactions

date_range 27-Dec-2024
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Phnom Penh, December 27, 2024 --

The National Bank of Cambodia (NBC) on Dec. 26 issued a Prakas outlining the licensing requirements for institutions and entities engaging in cryptoasset transactions.

The Prakas, composed of 6 chapters and 26 articles, applies to all Commercial Banks and Payment Service Institutions, under the purview of the NBC supervisory authority, intending to have cryptoasset exposures and/or to provide cryptoasset service as cryptoasset service providers (CASPs).

The Prakas classifies cryptoassets into two groups - Group 1 and Group 2.

Group 1 consists of cryptoassets that are digital representation of traditional financial instruments or the value of which refers to traditional assets or to a pool of traditional assets known as reference assets.

Group 2 includes all cryptoassets that do not meet the criteria of Group 1, in particular, but not limited to, unbacked cryptoassets that are neither tokenised traditional assets nor stablecoins.

Any commercial bank or payment services institution wishing to offer or involve the conduct of one or more of the services as stipulated in Article 20 shall obtain prior authorisation from the NBC.

Any entity wishing to operate as CASPs on one or more of the services as stipulated in Article 20 shall obtain a licence from the NBC.

The Prakas provides a framework for institutions and entities to operate within the legal boundaries while mitigating potential risks associated with cryptoasset transactions.

“The purpose of this Prakas is to manage the transactions and business activities related to cryptoassets in accordance with Article 2 to 4 of the Law on Banking and Financial Institutions,” NBC said.

Commercial banks, payment services institutions, and licensed CASPs failing to comply with this Prakas shall be penalised according to Article 52 of the Law on Banking and Financial Institutions.