As covered, Cambodia recently issued its own national cryptocurrency, the “Entapay.” The national cryptocurrency will reportedly have the potential to overthrow payments giants like VISA. Despite its seemingly forward-thinking approach, the country has been rejecting cryptocurrencies, while embracing blockchain technology.
According to the Pnom Penh Post, the country’s Deputy Prime Minister, Men Sam An, recently encouraged Entapay to follow the country’s laws. This, according to several fintech entrepreneurs the publication spoke to, is easier said than done.
Per In Mean, the lead developer of the Khmer Crypto Foundation, Cambodia’s central bank, the National Bank of Cambodia (NBC), has been reluctant when it comes to cryptocurrencies. So much so, that in December it declared cryptocurrency transactions illegal in the country.
The financial institution stopped companies from buying, selling, and advertising in cryptocurrencies, which in turn prevented the country’s citizens from buying and selling cryptocurrencies.
This means that while the country didn’t ban cryptocurrencies per se, it did make it difficult for people to use them. Mean, who’s also the developer of KHCoin, managed to use his cryptocurrency while giving it away for free.
When Mean attempted to monetize it, he saw the NBC hit cryptocurrencies. Yet, he claims to understand where the financial institution is coming from, as the cryptocurrency ecosystem is filled with scams, is volatile, and unregulated.
“I wanted to bring value to my coin, but when I started my payment system, the national bank said, ‘Any crypto transaction is illegal.”
Seemingly, the government doesn’t see Entapay like it sees Bitcoin or Ethereum. The cryptocurrency will have a multi-functional payment system, and offline transactions. Per its website, it has “quantum encryption technology,” and is “expandable” so its future development is “unlimited.”
Users will be able to manage various cryptocurrencies using an Entapay wallet, which means the country’s official stance on the cryptocurrency space may be about to change.
Cambodia Embraced Blockchain Technology
Despite its stance on cryptocurrencies, Cambodia has a warmer attitude towards their underlying technology. Before going against cryptocurrencies, the NBC signed an agreement with a Japanese firm to develop a digital ledger to track interbank transactions.
Steve Miller, the founder of Cambodia-based blockchain group CryptoAsia, revealed the NBC’s project is a private blockchain, one without the added advantage of cryptocurrencies. He said:
“Cryptocurrencies are necessary for public blockchains to function properly because they provide the incentive for anonymous participants to secure the system.”
Speaking to the Pnom Penh Post Rithy Thul, a blockchain entrepreneur, revealed the technology’s future remains uncertain in the country, although he believes it’s a good sign the country’s central bank is trying to use it.
Pierre-Marie Riviere, the network lead of DApact, a company using blockchain technology to connect lenders and borrowers, claimed the technology is already being deployed n Cambodia.