Myanmar’s Crypto Revolution: A Battle for Financial Freedom

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Introduction

In a country where the economy has been crippled by military rule and inflation is soaring, the people of Myanmar are turning to cryptocurrency as an alternative currency. The National Unity Government (NUG) and the State Administration Council (SAC), the ruling military junta, have both acknowledged the need for a digital currency, but their visions for its use couldn’t be more different.

The NUG’s Plan: Tether as Official Currency

The NUG, which was formed after the February 2021 coup, has announced plans to introduce Tether, a stable cryptocurrency pegged to the US dollar, as an official currency. The move is seen as a way to free the country from the centralized control of the military and allow for faster and more secure transactions.

The SAC’s Ban: A Move to Control Citizens

However, the SAC has banned all forms of cryptocurrency in Myanmar, including Bitcoin and Ethereum. In January 2022, they drafted a cybersecurity law that criminalizes the use of VPNs and cryptocurrencies. The irony is not lost on many, as the military has also announced plans to develop its own digital currency.

Critics Argue that True Intention Behind Digital Currency Development is Control

According to Maj General Zaw Min Tun, spokesperson for the SAC, a digital currency will help improve financial activities in Myanmar. However, critics argue that the true intention behind the move is to monitor and control citizens more seamlessly.

The Rise and Fall of MYD: A Decentralized Alternative

MYD, a cryptocurrency created by an anonymous developer group last year, aimed to liberate people from the centralized control of the military. However, it failed to build a scalable user base and ceased operation in December 2021.

The Controversy Surrounding Tether

The NUG’s choice of Tether has raised eyebrows, given its questionable aspects. Tether is the third largest cryptocurrency with a market cap of $76 billion, but it has also been criticized for its potential threat to financial stability. US Federal Reserve President Eric Rosengren warned in June 2021 that Tether could be a risk to financial stability, and crypto trader Bernhard Muller has described it as a “black swan” that could dramatically collapse.

Lessons from Venezuela: A Cautionary Tale

Venezuela’s experience with cryptocurrency is often cited as an example of both resistance and repression. The country was one of the most rapid adopters of cryptocurrency in the world, with Venezuelans turning to cryptocurrencies to escape hyperinflation and US sanctions. However, the government has also sought to centralize the crypto movement by creating Petro, a national digital currency.

Myanmar’s Crypto Revolution at a Crossroads

Myanmar’s crypto revolution is at a critical juncture, with strategies for its development emphasizing legislative activities rather than social digital innovations. As the country navigates this complex landscape, it will play a crucial role in shaping Myanmar’s future: whether it will be able to restore democracy or succumb to authoritarianism.