Aug, 29 2026
You might think a total government ban would kill a market. In Cambodia, it did the opposite. It pushed underground crypto trading into the shadows, where it merged with human trafficking and transnational crime. Today, this isn't just about people buying Bitcoin on their phones. It’s about billions of dollars moving through a network of "scam compounds" that look like hotels but function like prisons.
If you are tracking digital assets or following Southeast Asian finance, you need to understand how Cambodia became a global hub for illicit crypto flows. The story involves a specific group called the Prince Group, a platform named Huione Guarantee, and a regulatory shift that happened too late to stop the damage. Here is what is actually happening on the ground.
The Ban That Backfired
In 2019, the National Bank of Cambodia (NBC) issued Directive No. 1125. This order banned all cryptocurrency transactions. On paper, this should have wiped out the local crypto scene. But Cambodia has always been a cash-heavy society with limited access to formal banking for many citizens. When you ban a service people want, they don’t stop using it; they just move it off the books.
Instead of disappearing, crypto adoption persisted. Reports from Standard Insights in 2025 show that roughly 10.63% of Cambodians still used cryptocurrency despite the prohibition. Who was facilitating this? Not licensed banks. It was an informal network of exchange houses and online platforms operating in a legal gray zone. This vacuum allowed criminal organizations to step in and offer liquidity when legitimate channels were closed.
Huione Guarantee: The One-Stop Crime Platform
At the center of this underground economy sits Huione Guarantee, also known as Huiwang Group. Founded in 2014, Huione started as a payment gateway but evolved into something far more complex. Elliptic, a blockchain analytics firm, described it as a "one-stop crime platform." Think of it as an app store for criminals. If you ran a scam ring in Southeast Asia, you didn’t just need a place to swap USDT for Khmer Riel. You needed tools.
Huione offered technology stacks, personal information databases, and money laundering services. For a time, it operated openly on Telegram, allowing vendors to sell everything from fake IDs to bulk accounts. When Telegram blocked the main channel in May 2025 due to compliance pressure, the operations didn’t die. They went deeper underground, using encrypted channels and private servers. Between August 2021 and January 2025, Chainalysis estimated that Huione laundered at least $4 billion. That includes $37 million linked to North Korean cyber thefts and nearly $300 million from other cybercrime activities.
The Prince Group and Scam Compounds
You cannot talk about Cambodian crypto without talking about the Prince Group. Led by Chen Zhi, this conglomerate grew into one of Asia’s largest transnational criminal organizations. While they own hotels and casinos, their real engine was a network of at least ten "scam compounds" across Cambodia. Places like the Jinbei Compound in Sihanoukville and Golden Fortune Science and Technology in Chrey Thom weren’t just offices. They were fortified camps.
Victims trafficked from China, Malaysia, and even Africa were lured with promises of high-paying jobs. Once inside, passports were confiscated. Workers were forced to run "pig butchering" scams-romance or investment fraud schemes targeting Westerners. If you failed your daily quota, you faced physical punishment. The profits from these scams, mostly paid in stablecoins like USDT, flowed directly back into the Prince Group’s ecosystem. A former worker told PANE News Lab he worked 18-hour days under threat of violence, executing crypto investment frauds that netted millions while he earned nothing.
How the Money Moves
Laundering crypto in Cambodia isn’t simple. It requires layers. First, victims wire fiat currency or send crypto to a wallet controlled by a scam compound. Then, the funds are moved through Huione or similar OTC (over-the-counter) desks. These desks convert digital assets into local currency or other cryptocurrencies, breaking the transaction trail.
Data from South Korea’s Financial Supervisory Service shows the scale. Transfers between five major Korean exchanges and Huione Guarantee jumped from 9.22 million won in early 2023 to 12.8 billion won ($8.9 million USD) in 2024. That is a 1,400-fold increase. By October 2025, despite scrutiny, transactions hit 3.15 billion Korean Won. Why Korea? Many scammers target East Asian markets, and South Korean exchanges provide the necessary volume and liquidity to wash the money clean before it enters the global financial system.
| Entity | Role | Estimated Impact |
|---|---|---|
| Huione Guarantee | Laundering & Payment Infrastructure | $4 Billion laundered (2021-2025) |
| Prince Group | Scam Operations & Asset Holding | $15 Billion BTC seized (Oct 2025) |
| National Bank of Cambodia | Regulator | Banned crypto in 2019; new licensing in 2024 |
| Chainalysis | Blockchain Analytics | Identified $37M North Korea link |
Regulatory Whiplash: From Ban to License
For years, the NBC stuck to its 2019 ban. But the economic reality was undeniable. Crypto was everywhere, especially among younger demographics and those dealing with cross-border remittances. In late 2024, the regulator introduced Prakas B7-024-735 Prokor. This shifted the model from a blanket ban to a permission-based licensing system.
The goal was to bring the market into the light. Banks could now handle some crypto-related activities if they followed strict Anti-Money Laundering (AML) rules. However, critics argue this move inadvertently helped the bad guys. Sophisticated networks like the Prince Group already had the resources to navigate partial regulations. They could register certain entities while keeping the dirty work in unlicensed subsidiaries. The new rules created a veneer of legitimacy for operations that were still deeply entangled with criminal proceeds.
International Crackdowns and Seizures
Cambodia’s underground market doesn’t exist in a bubble. It serves victims in the US, Europe, and Australia. In October 2025, the U.S. Department of Justice filed a civil complaint against Prince Group assets. Simultaneously, a coordinated action with the UK resulted in the seizure of approximately $15 billion in Bitcoin. According to TRM Labs, this was the largest forfeiture in U.S. history.
This wasn’t just symbolic. The DOJ complaint detailed how Prince Group used "illegal banks and underground money houses" to integrate illicit crypto flows with legitimate casino revenue. Documents mentioned terms like "BTC laundering" explicitly. The U.S. Treasury’s FinCEN also targeted Huione, alleging it processed billions in illicit funds. These actions signal that the era of impunity for Cambodian crypto barons is ending, though enforcement remains challenging.
What This Means for Investors and Travelers
If you are investing in crypto projects based in Southeast Asia, be wary of Cambodian entities with opaque ownership structures. The line between a tech startup and a front for a scam compound can be blurry. Look for clear AML policies and verifiable licenses under the new 2024 framework.
For travelers, the risk is different. You might encounter informal exchange rates that seem too good to be true. Often, they are. Using unregulated OTC desks carries the risk of holding tainted funds that could get frozen later. Stick to established international exchanges or regulated local providers if available. Remember, just because a platform looks professional-mimicking interfaces like Binance or KuCoin-doesn’t mean it is safe.
Frequently Asked Questions
Is cryptocurrency legal in Cambodia?
It is complicated. The National Bank of Cambodia banned cryptocurrency transactions in 2019 via Directive No. 1125. However, in late 2024, they introduced a permission-based licensing system (Prakas B7-024-735 Prokor). This means while general use was restricted, licensed entities can now operate under specific conditions. Most retail activity still happens in a gray area or through informal networks.
What is Huione Guarantee?
Huione Guarantee (Huiwang Group) is a payment and exchange platform founded in 2014. It became central to the underground crypto economy in Cambodia, offering services for money laundering, payment processing, and data tools. Chainalysis estimates it laundered over $4 billion between 2021 and 2025, handling funds from cybercrime, gambling, and scam operations.
Who is the Prince Group?
The Prince Group is a Cambodian conglomerate led by Chen Zhi. It operates hotels, casinos, and real estate, but is also accused of running scam compounds where trafficked workers execute cryptocurrency fraud schemes. In 2025, the U.S. DOJ initiated civil forfeiture proceedings against its assets, including a massive $15 billion Bitcoin seizure.
Why do scammers use Cambodia?
Cambodia offers a combination of weak financial regulation, a cash-based economy, and proximity to major crypto markets in South Korea and Southeast Asia. The presence of large-scale scam compounds provides a workforce and infrastructure for "pig butchering" scams, while underground exchange networks facilitate the rapid movement of illicit funds.
Can I recover money lost to Cambodian crypto scams?
Recovery is difficult. Funds often move through multiple mixing services and offshore accounts quickly. Victims typically report losses ranging from $5,000 to $250,000. Legal avenues involve filing complaints with local police and international bodies like Interpol, but success rates are low due to the complexity of tracing cross-border crypto transactions.
Laine Van Sickle
August 29, 2026 AT 14:46omg this is so sad i cant believe people are trapped in those places 😭 its like a horror movie but real life and nobody cares enough to fix it fast enough
Jarnail Singh
August 30, 2026 AT 13:28It is truly fascinating how the Western media portrays these situations while ignoring the sheer scale of financial sophistication involved here 🤔 because let us be honest, the Indian IT sector has been dealing with similar regulatory gray areas for decades, yet we never hear about 'scam compounds' in Bangalore or Hyderabad where the actual tech backbone resides 💻 The narrative that Cambodia is some lawless frontier ignores the fact that global capital flows require such hubs, and frankly, if your country cannot regulate its own digital assets properly, do not blame the developing nations for providing liquidity services to the world's largest economies who refuse to adopt clear frameworks themselves 🌏 We should be looking at our own domestic policies before pointing fingers across borders, especially when the US dollar dominance is what drives these illicit flows in the first place.
Ashwini Chaskar
August 31, 2026 AT 18:54this is exactly why regulation without enforcement is just theater
the poor workers are victims twice over once by traffickers and again by governments that look away until billions are lost
Sam Ariafar
September 2, 2026 AT 18:19We need to stop treating crypto as some wild west free market fantasy. When you have $4 billion laundered through a single platform, that is not innovation; that is institutional failure. The moral cost of allowing these 'gray zone' operations to flourish is paid by human beings who are enslaved. It is unacceptable to prioritize transaction speed over human rights.
Jane yuan
September 4, 2026 AT 10:30Capital seeks the path of least resistance. If the West bans, the East absorbs. This is not a Cambodian problem; it is a global arbitrage problem. The ban created the vacuum, and crime filled it. Simple physics.
Jillian Pye
September 5, 2026 AT 16:50I appreciate the depth of this analysis. It helps to see the systemic connections rather than just the sensational headlines. 🙏
Martha Packard
September 6, 2026 AT 01:41You're all missing the point. The 'ban' was never meant to work. It was performative governance designed to appease traditional bankers while letting the real money flow underground where they couldn't tax it. The Prince Group isn't an anomaly; it's the logical endpoint of unregulated globalization. You want cheap labor and high returns? You get scam compounds. It's the invisible hand strangling people. Don't pretend you didn't know.
Trista Dennis
September 6, 2026 AT 06:44Oh, wow, another article telling us that banning things doesn't work. Groundbreaking. Next you'll tell me that putting a 'No Trespassing' sign on a haunted house stops ghosts. The irony of a government trying to control a decentralized currency with centralized bureaucracy is rich enough to eat.
Ashwin Bhandurge
September 7, 2026 AT 09:05This is a wake-up call for all of us! We need to stay vigilant and support ethical platforms. Let's keep pushing for transparency and better regulations globally. We can make a difference if we stand together! 💪🚀
Teresa Watson
September 8, 2026 AT 09:22wait hold up
so you're saying my uncle's 'investment opportunity' in phnom penh might actually be him getting scammed by a guy in a hotel room??
i always knew something was off with that 'guaranteed 20% monthly return' thing he kept bragging about
this explains everything honestly
Nadia Christian
September 9, 2026 AT 17:09This is very important information!!!
We must protect our citizens from these foreign scams.
The US needs to do more to stop this inflow of dirty money.
Our economy depends on clean transactions.
Why aren't we doing more??
jeffry jones
September 10, 2026 AT 04:42Good breakdown. For those in DeFi, watch out for OTC desks with low KYC thresholds. High volume + low compliance = red flag for wash trading or layering. Stick to regulated entities.
Paul Needham
September 11, 2026 AT 11:45Sure, great story. But did you check if Huione is still accepting USD wire transfers? I tried sending $5k last week and got stuck in limbo for three days. Just wondering if the 'underground' part applies to normal users too or just the big fish.