- Tether becomes the official currency of Myanmar’s Shadow Government for ‘domestic use.’
- The group is also using a direct lending mechanism to raise funding.
After the group began funding a campaign to overthrow Myanmar’s military rule, a parallel government run by followers of deposed leader Aung San Suu Kyi recognized Tether as an official currency for local use.
In a Facebook post on Sunday, NUG Finance Minister Tin Tun Naing said that the government now accepts Tether, a cryptocurrency designed to act as a dollar substitute, for
“domestic usage to make it easy and speed up the present commerce, services, and payment systems.”
There were no other specifics provided.
The NUG is a coalition of former civilian government members and pro-democracy organizations. While the group does not control territory or occupy positions of authority in Myanmar, it declared war on the military state in September, escalating confrontations between the military dictatorship and local resistance groups.
The use of bitcoin by the shadow government demonstrates its defiance of Myanmar’s Central Bank, which declared all digital currencies illegal in May of last year, threatening violators with imprisonment and fines. Unlike Bitcoin and Ethereum, which have daily price swings, Tether is designed to be backed by one dollar and is hence called a stablecoin.
This action comes as policymakers worldwide weigh the pros and cons of incorporating cryptocurrencies or stablecoins into their financial systems. El Salvador was the first to do so, making Bitcoin legal tender alongside the dollar on September 7, the most significant test of its utility as a medium of trade to date.
The NUG isn’t just interested in cryptocurrency. The organization raised $9.5 million in the first 24 hours via the selling of “Spring Revolution Special Treasury Bonds” to the Myanmar diaspora around the world to aid in the overthrow of the current administration, which coup leader Min Aung Hlaing leads. The bond looks to be set up as a form of direct lending.
Due to great demand, purchases were halted for a week until December 6, and little information on how much money has been raised so far has been released. In order to assist with sales, the NUG intends to recruit representatives in several countries.
Last week, the NUG announced that these so-called bonds would be offered within Myanmar soon, tapping into rising anti-government sentiment just days after a local court found Suu Kyi guilty of inciting dissent against the military. She was initially sentenced to four years in prison, but her sentence was reduced to two years at the current secret location where she is being imprisoned.
The NUG hopes to generate $1 billion through the sale of the bonds, which the junta claims violate anti-terrorism legislation.
The group appears to be concentrating on cryptocurrencies such as Tether, which can be traded anonymously on peer-to-peer platforms. The stablecoin, on the other hand, has been the subject of years of speculation that it wasn’t really backed one-to-one with dollars as claimed.