USDT Fuels the Underground Economy of Cambodia, Reports SCMP
The South China Morning Post (SCMP) has published a report explaining the role of USDT in fueling the underground Chinese-linked economy of Cambodia. The stablecoin is a mode of payment in various illicit activities to circumvent capital controls for Chinese nationals and to acquire tools used in facilitating online scams.
Shadow Economy of Cambodia and the Stablecoin USDT Connection
The South China Morning Post (SCMP) has published an article that reveals the USDT connection in running the shadow economy of Cambodia. The largest dollar-pegged stablecoin in the crypto realm, Tether, is facilitating underground activities in Cambodia. The stablecoin is widely available in exchanges targeting the Chinese expat community living in Cambodia, reports SCMP.
Huione Pay is a Cambodia-approved financial platform that hosts several Telegram groups providing exchange services for crypto assets, including USDT. Some of these groups are known to offer tools for facilitating scam operations involving international SIM cards and data on Chinese citizens overseas, according to the SCMP’s investigation.
The report identifies operators advertising bank cards that can be used to receive money from scam victims, criminal background checks, company records, and bank statements. USDT is accepted for the services by the operators. Since 2017 cryptocurrency has been banned in Cambodia.
Jeremy Douglas, the regional representative of the United Nations Office on Drugs and Crime, explained that using cryptocurrency has overwhelmed local authorities who have failed to keep up with the technology.
He stated:
"The capacity of criminal groups running online gaming, scams, money-laundering operations, and underground banks is far more advanced than most enforcement agencies in Southeast Asia."
Tether Steps Up Compliance
Tether is cooperating recently to step up its compliance with the US by proactively freezing all funds categorized by the Office of Foreign Assets Control's (OFAC) Specially Designated Nationals and Blocked Persons List (SDN List). The company has extended its collaboration with US government agencies, stating it has “onboarded” the US Secret Service on its platform, and the same process will be repeated with the Federal Bureau of Investigation (FBI).
What is your take on Tether’s alleged role in the Cambodian shadow economy? Please share your thoughts and opinions in the comments section below.
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