Central Bank of Myanmar provides a warning against the risks of transactions with cryptocurrencies

The Central Bank of Myanmar (the “CBM”), by an announcement on 3 May 2019, noted that it does not recognize digital currencies as legal tender in Myanmar (the “Announcement”). The CBM further stated that any persons that engage in transactions involving digital currencies act at their own risk. 

The Announcement, which is cautionary in nature, notes that transactions and exchanges involving digital currencies such as Bitcoin, Litecoin, Ethereum, Perfect Money are taking place over social media and through other web portals in consideration for services.

Furthermore, the CBM makes it clear that financial institutions in Myanmar have not been authorized to deal with digital currencies.

Given that the Announcement does nothing more than caution against the use of digital currencies for payment of services, it remains to be seen whether the CBM publishes any notification or directive penalizing such transactions. The Announcement, in and of itself, is not legally binding unless CBM publishes a notification or directive in this regard, which will then have the force of law.

While previously there was essentially no legal framework that would regulate digital currencies, the new Announcement further clarifies the position of the regulator in their respect.