Cambodia’s growing demand for blockchain technology investment has been highlighted at an event hosted by Swiss Partnership Cambodia as the central bank’s own blockchain-based payment application ‘Bakong’ records over $3.5 billion in combined currency transactions for 2021.
Blockchain technology is described as a system in which a record of transactions are maintained across several computers that are linked in a peer-to-peer network and is already transforming Cambodia’s supply chain and finance sectors.
The locally based NGO Swiss Partnership Cambodia commented that Switzerland was preparing itself to be the global center for blockchain startups and technologies and was hoping to export the technology around the world.
Speaking via video at the event Mathias Ruch, CEO of and Co-Founder of Crypto Valley Venture Capital said his Swiss-based company was looking to reach out to developing markets such as Cambodia where blockchain can provide secure transaction tracking.
He added the fund was now reaching out to developing nations particularly in Africa and Asia despite the many legal hurdles and lack of regulation throughout the continent.
According to Ruch, the company has already invested in 12 startups based on blockchain and/or crypto, with plans to invest in 100 more over the next four years.
Cambodia already embracing blockchain technology
While cryptocurrencies are not yet legal in Cambodia without a license, the Kingdom is already embracing blockchain-based technology such as Non-Fungible Tokens as well as the central banks own money transfer app ‘Bakong’ which utilizes blockchain technology to seamlessly transfer money between financial institutions.
According to data provided by the National Bank of Cambodia in 2021 the payment application processed over 8.16 million transactions worth KHR 2.51 trillion ($619 million) and $2.89 billion increasing 62 times and 82 times respectively year-on-year.
To read more about the Bakong payment application click here.
Ruch said that while many may not yet fully understand the technology it was fast becoming part of our everyday lives and according to Ruch held immense potential across many sectors stating: “There is already protocols in place through blockchain technology for donating to charities so people can trace their donation through to its final implementation.”
Commenting on the legal aspects of cryptocurrencies both in Cambodia and around the region he added: “The new Chinese Crypto exchange is now bigger than any stock exchange in the world, while its founder is now the second richest man in the country. Governments will slowly start to embrace the sector as they learn that it is not only a force for good, but is not going away”.
More blockchain firms ready to enter developing markets
Answering a question directly from Cambodia Investment Review about when Crypto Valley Venture Capital would be entering the Cambodian or the ASEAN market, Ruch stated: “When entering a market we seek three things, a fixed network, a skill set, such as fund managers and most importantly local capital. Once these are met we enter a market”.
Ambassador of Switzerland to Cambodia H.E. Helene Budliger Artieda said the consulate would be able to help, pointing out the success of the digital exchange BitKub in Thailand and the immense opportunities it could bring.
“There is huge potential for employment here. BitKub are looking to hire more than 500 blockchain personnel but simply cannot find the staff. These are highly skilled jobs that can be filled by local staff if the training is provided,” she said.
According to the ambassador, it was not only through jobs but also entrepreneurship that blockchain offered chances for the youth of Cambodia and ASEAN
“In many countries throughout the region business is controlled by a few big families. Through embracing these technologies entrepreneurs have the chance to break through this glass ceiling, in a way not possible in other sectors,” she added.
While venture capital for blockchain technology in Cambodia was still limited, Kuch was keen to point out the importance of the region to Crypto Valley Venture Capital and commented that: “ASEAN will be the next place we expand to after Africa, and although we cannot say exactly when, we feel the region offers just as much, if not more.”