“Project Bakong” first trialed last summer is a specially designed digital currency that will serve as the national payment gateway for Cambodia. Based on the blockchain technology, a peer-to-peer platform with its own digital currency will be launched in the coming months.

Bakong central digital currency was designed by the Japanese blockchain company. The company Soramitsu has developed a system that supports any type and number of currencies, including crypto.

As explained by the Central Bank’s director-general Chea Serey, the central bank digital currency (CBDC) will bring all participants in Cambodia’s payment space under the same platform which allows end-users to settle the payments easily regardless of the institutions they bank with.

According to PPCBank President Shin Chang Moo, “Project Bakong” is cheaper and more convenient as compared to conventional transfer and payment methods such as credit and debit cards. Moreover, he added that there is no opportunity for speculation as the digital currency is highly centralized. Despite some may consider that this project could hit the banking business, Chang Moo clarified that CBDC would not jeopardize the traditional banking business.

The digital currency project has already received the support of 11 national banks, with others expected to join. The banks will link a Bakong wallet with the users’ bank accounts, allowing the fiats exchange into the new digital currency in the real-time. As all transaction data will be stored by the National Bank, payments may be fully traceable.

Although the Bakong platform was initially designed for internal domestic payments, the National Bank is also planning to integrate cross-border payments into the blockchain-based system in the future.

Besides, the financial authority has pushed the initiative to introduce QR code system transactions throughout Cambodia.

According to the President of PPCBank, the central bank digital currency will "create financially inclusive ecosystems that all the stakeholders in the industry can benefit from."

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