Myanmar’s financial services regulator is not fond of digital currencies, and it has made its stand crystal clear. The Central Bank of Myanmar (CBM) recently announced that it had outlawed the use of digital currencies in the country. However, digital currency users in the Southeast Asian country believe that this is just talk and that the law is on their side.
Myanmar has seen a surge in digital currency interest in the past few years, the Myanmar Times reports. This hasn’t gone unnoticed by the regulator which in its most drastic move yet has banned the use of digital currencies in the country. The CBM stated that it doesn’t recognize digital currencies as legal tender. It further banned all commercial banks from accepting or facilitating transactions made in digital currencies.
The CBM warned that anyone who trades in digital currencies stands facing heavy penalties including imprisonment and heavy fines.
Despite the strict warning, the digital currency community in Myanmar is unfazed. According to the traders, the regulator has no authority to make such declarations or to act on them. They believe that such declarations must be supported by legislation, and as it stands, no law prohibits the trading of digital currencies.
“The CBM has not prohibited the use of cryptocurrencies under the law. It has just issued an announcement. As there is no official law, it can’t be said that trading in digital currencies is illegal,” Nyein Chan Soe believes. Soe is the founder of Get Myanmar, a digital commerce platform.
The tough stand by the CBM will only aggravate the challenges that already exist, he believes. Instead of making digital currencies illegal, “their impact on the local currency and compatibility with existing policies should first be analysed and discussed.”
This isn’t the first time that the CMB has gone against digital currencies. In 2019, the watchdog warned the public against trading in digital currencies, terming them a ‘risky investment’. The lack of regulations and the price volatility were some of the reasons the regulator cited.
Myanmar has seen its fair share of digital currency scams, making CBM and other regulators wary of the industry. The country’s Ministry of Home Affairs has in the past revealed that it has received several reports of scams targeting the rural population.
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