Cryptocurrencies, notably Tether, have become an integral part of Cambodia’s underground economy due to low transaction fees and the ease of moving and laundering money. However, this cryptocurrency boom has raised concerns about scams and Ponzi schemes targeting unsuspecting investors. Cambodia’s adoption of cryptocurrencies operates in a grey area, with the national bank embracing blockchain technology for QR payments and transfers but officially banning cryptocurrencies since 2017.
Cambodia’s shadow economy has embraced cryptocurrencies, particularly Tether, for their low fees and ease of use in moving and laundering money. Tether, a stablecoin that claims to be backed by US Treasury Bills, is heavily utilized in the region. However, critics doubt whether Tether has sufficient assets to support its minting.
The country’s ecosystem of crypto exchanges mainly operates as an underground financial service, with one financial platform, Huione Pay, conducting its USDT exchange activities primarily online through interlinking Telegram channels. Huione Pay also offers services such as online investigations, targeting potential scam operators.
While Cambodia’s national bank has adopted blockchain technology for QR payments, cryptocurrencies have officially been banned in the country since 2017. Despite the ban, digital currencies remain prevalent in Cambodia’s physical and online casinos. Tether has emerged as the preferred cryptocurrency for online gambling businesses catering to the Chinese market.
However, this cryptocurrency boom has come with risks. There are concerns over scams and Ponzi schemes that specifically target less informed investors. Additionally, the risks of hacking cryptocurrency exchanges and wallets pose a significant threat in Cambodia. Cybercriminals and Southeast Asia’s crime groups are drawn to Tether due to its attractiveness for illicit activities.:
Cryptocurrencies, particularly Tether, have found a niche in Cambodia’s underground economy. The low fees and ease of money movement make them popular choices. However, the cryptocurrency boom has raised concerns about scams and Ponzi schemes targeting less informed investors. Cambodia’s national bank has embraced blockchain technology for QR payments, while cryptocurrencies remain officially banned since 2017. Nonetheless, digital currencies thrive in Cambodia’s casinos, with Tether being the preferred cryptocurrency for online gambling businesses catering to the Chinese market. The risks of hacking and illicit activities associated with cryptocurrencies pose significant challenges in the country’s evolving shadow economy.