Preparing Cambodia for the Rise of BTC and USDT Wallet-to-Wallet Scam Networks

IMAGE: 729 Burmese were deported from Cambodia for immigration crimes and alleged involvement in online scam operations. GDI

#opinion

Cambodia’s fight against online scams is entering a new phase. From a legal and regulatory perspective, the financial methods behind these crimes are evolving faster than traditional enforcement tools. Scam networks are increasingly shifting from cash-based laundering and bank transfers toward cryptocurrencies — particularly Bitcoin (BTC) and stablecoins such as USDT — through direct wallet-to-wallet transactions.

As a lawyer observing Cambodia’s ongoing efforts against cyber-enabled fraud, it is increasingly clear that the next challenge is not only dismantling scam compounds, but also addressing the digital financial infrastructure that sustains scam economies.

This trend is not simply a technological development. It represents an emerging challenge for Cambodia’s legal system, regulatory institutions and law enforcement capacity. The question is no longer only whether Cambodia can disrupt scam operations physically, but whether it can respond effectively to the financial mechanisms that increasingly operate in digital form.

A Changing Financial Dimension of Online Scams

Traditional scam operations often relied on cash couriers, informal money networks or bank transfers. These channels, while frequently abused, still passed through intermediaries that could be regulated, monitored or compelled to cooperate with investigations.

Cryptocurrency transfers differ in important ways. Wallet-to-wallet transactions can occur directly between individuals or entities without passing through regulated financial institutions. They are often rapid, cross-border and difficult to reverse once executed.

Scam operators increasingly instruct victims to transfer BTC or USDT under fraudulent schemes such as fake investments, online impersonation, romance scams or deceptive job recruitment. Once funds are sent, tracing and recovery become significantly more complex.

This evolving financial dimension of online scams is reshaping the challenges authorities must confront.

Cambodia’s Ongoing Enforcement Efforts

Cambodia has undertaken substantial enforcement actions against online scam networks in recent years. Nationwide crackdowns have resulted in arrests, closures of scam sites and greater transparency regarding enforcement outcomes. Reporting indicates that Cambodian authorities have detained thousands of individuals linked to scam operations as part of coordinated anti-scam campaigns.

Cambodia has also strengthened cross-border cooperation. In early 2026, authorities repatriated dozens of South Korean nationals to face investigation abroad in connection with online scam allegations, reflecting deeper bilateral engagement on cybercrime cases.

These developments demonstrate operational commitment. However, scam networks are adapting quickly, and cryptocurrency-based transfers complicate traditional investigative tools.

The Growing Role of Stablecoins

While Bitcoin remains the most widely recognized cryptocurrency, stablecoins such as USDT have become increasingly prominent in regional digital markets.

Unlike Bitcoin, stablecoins maintain a value close to the US dollar, offering price stability and ease of transfer.

This stability makes USDT attractive for legitimate commerce, but also for criminal misuse. Across Southeast Asia, stablecoins have been increasingly observed in scam-related financial flows because they allow fraud proceeds to be moved quickly without exposure to volatility.

Cambodia, as part of this regional digital economy, faces similar risks as scam networks adapt to stablecoin-based transfers.

Cambodia’s Regulatory Progress

Cambodia has taken meaningful steps toward developing a clearer regulatory framework for cryptoasset-related activities. In December 2024, the National Bank of Cambodia issued Prakas No. B7-024-735 on Transactions Related to Cryptoassets, establishing rules governing cryptoasset activities by supervised financial institutions, including commercial banks and payment service providers.

This represents an important milestone in Cambodia’s evolving financial oversight. It signals progress toward structured engagement with cryptoassets under regulatory supervision.

Cambodia has also previously taken restrictive measures against unauthorised crypto activity, including actions aimed at limiting access to unlicensed exchange platforms, reflecting concerns about misuse in illicit finance and scams.

These steps indicate that Cambodia is aware of crypto-related risks and is moving toward a more formal regulatory approach. At the same time, wallet-to-wallet scam transactions often occur outside licensed intermediaries, through informal channels or offshore platforms, which remain more difficult to monitor.

Why Institutional Readiness Matters

Addressing cryptocurrency-enabled scam networks requires additional institutional tools beyond traditional enforcement approaches.

First, crypto investigations require specialised technical capacity. Blockchain transactions can sometimes be traced, but doing so effectively requires forensic tools, trained investigators and coordinated financial intelligence capabilities.

Second, digital assets move rapidly. Scam proceeds can be dispersed across multiple wallets or jurisdictions within minutes, creating timing challenges for asset freezing and recovery through traditional legal processes.

Third, many service providers operate internationally. Exchanges, brokers and crypto platforms may be based offshore, requiring strong cross-border cooperation mechanisms and timely legal assistance procedures.

Finally, peer-to-peer trading environments can reduce transparency if not effectively supervised. Informal crypto markets may allow illicit proceeds to circulate outside regulated institutions, creating enforcement blind spots.

These factors suggest that combating scam networks increasingly depends not only on physical crackdowns, but also on cyber-financial expertise and institutional modernisation.

A Policy Opportunity for Cambodia’s Leadership

The rise of wallet-to-wallet scams involving BTC and USDT presents an opportunity for Cambodia to strengthen its long-term response through forward-looking reforms.

National readiness could be enhanced through several measures:

Expanded capacity building for cyber-financial and blockchain investigations

Strengthened coordination between regulators, financial intelligence units and law enforcement agencies

Continued development of licensing and compliance frameworks for cryptoasset service providers

Clearer and faster legal mechanisms for freezing and seizing digital assets linked to fraud

Targeted legal amendments to ensure crypto-enabled scam proceeds are fully addressed within fraud and anti-money laundering frameworks

Deeper ASEAN and international cooperation on digital asset enforcement and intelligence sharing

Such reforms would not only support domestic enforcement, but also strengthen Cambodia’s credibility and resilience in addressing transnational cybercrime.

Conclusion: Preparedness Today, Protection Tomorrow

Cambodia’s recent actions against online scam networks demonstrate commitment and progress. Yet the financial methods of scam operators are evolving, and wallet-to-wallet cryptocurrency transfers using BTC and USDT represent an emerging dimension that requires proactive preparation.

Cambodia has already taken important steps, including recent regulatory developments by the National Bank of Cambodia. The next phase should focus on capacity building, institutional coordination and legal modernisation to ensure that Cambodia remains resilient against emerging crypto-enabled scam trends.

Preparedness today will be essential to protection tomorrow.

Panhavuth Long is founder and an attorney-at-law at Pan & Associates Law Firm. The views and opinions expressed are his own.

-Phnom Penh Post-