Account Closure Penalties for Crypto in Myanmar: What Happens If You Trade Bitcoin or USDT
Jan, 27 2026
If you’re using Bitcoin, Ethereum, or USDT in Myanmar, your bank account could be shut down tomorrow-no warning, no appeal. This isn’t a hypothetical risk. It’s happening right now. Since May 2024, the Central Bank of Myanmar (CBM) has been actively closing accounts linked to cryptocurrency transactions. People who sent money via Telegram, traded on local exchanges, or even accepted crypto as payment for goods have lost access to their savings overnight. And it’s not just about losing your account. You could also face jail time.
Why Myanmar Banned Crypto Completely
Myanmar doesn’t just discourage crypto-it outlaws it. Under the Central Bank of Myanmar Law grants the CBM exclusive authority to issue currency and regulate all financial transactions in the country, any use of digital currencies like Bitcoin, Ethereum, or Tether (USDT) is considered illegal. The government’s reasoning is simple: they want total control over money. After the 2021 military takeover, the kyat collapsed, inflation soared, and people turned to crypto to protect their savings and send money abroad. That’s exactly what the regime feared.The CBM doesn’t see crypto as innovation. They see it as a threat to their power. When citizens use USDT to pay for medical supplies or send remittances to family overseas, they bypass state-controlled banking. That’s why the CBM responded with extreme force: account closures, legal charges, and prison sentences under the Anti-Money Laundering Law and the Financial Institutions Law.
What Happens When Your Account Gets Closed
The first thing you’ll notice? You can’t log in to your online banking. Your ATM card stops working. Your salary doesn’t arrive. Your rent payment bounces. And there’s no phone number to call, no email to reply to. The CBM doesn’t notify you in advance. One day your account is active; the next, it’s frozen-no explanation, no appeal.Then comes the second wave: legal action. The CBM has filed cases against dozens of individuals since 2024. Most are charged under the Anti-Money Laundering Law for “unauthorized currency conversion.” Even if you only bought $100 worth of USDT to send to a relative in Thailand, you can be prosecuted. Fines range from 5 million to 50 million kyat (roughly $2,500 to $25,000 USD). But fines are the least of your worries. If you’re found guilty, you could get sentenced to 1 to 5 years in prison.
One case in Mandalay involved a shop owner who accepted USDT from customers for electronics. He didn’t convert it to kyat-he just held it. Still, his bank account was closed. Police raided his home, seized his laptop and phone, and charged him with violating financial laws. He spent six months in pre-trial detention before his case was dropped due to lack of evidence. He lost his business. His savings were gone. And he still can’t open a new bank account.
How the CBM Finds You
You might think you’re safe if you use a VPN or trade on offshore exchanges. You’re not. The CBM works closely with local banks and telecom providers. They track:- Transactions between bank accounts and known crypto wallet addresses
- Payments made through mobile apps linked to Facebook or Telegram
- IP addresses used to access crypto exchanges from Myanmar
- Withdrawals from ATMs that match patterns of crypto cash-outs
They also monitor social media. In 2024, the CBM publicly named Facebook pages that advertised crypto trading services. Owners of those pages were arrested. Even people who simply shared those posts have been questioned.
Stablecoins like USDT on the Tron network are the most common target. Why? Because they’re used for international payments. If you’re sending money to a friend in Malaysia using USDT, the CBM sees that as illegal foreign exchange. They don’t care if you’re helping family-they care that you’re bypassing their system.
Underground Crypto Is Still Alive-But Riskier Than Ever
Despite the risks, crypto hasn’t disappeared. It’s gone deeper underground. Mining operations now run out of hidden rooms in residential buildings, powered by stolen electricity. Peer-to-peer trades happen over Telegram groups with coded language: “green tea” means USDT, “rice delivery” means a cash transfer.Some people use third parties as middlemen-someone in Thailand receives your USDT, then sends kyat to your relative in Yangon. But this adds another layer of danger. If the middleman gets caught, they’ll name names to reduce their own sentence. Trust is gone. Everyone’s afraid.
Even the opposition National Unity Government (NUG), which controls parts of northern Myanmar, declared USDT legal in 2021 to fight junta economic control. But that only makes things more confusing. If you’re in a region controlled by the NUG, you might think you’re safe. But if you travel to a junta-controlled city, your phone gets scanned, your bank records pulled, and you’re treated as a criminal.
The Digital Kyat Is Coming-And It’s Not an Alternative
In June 2025, the CBM created the Central Committee for the Issuance of Central Bank Digital Currency a government body tasked with developing a state-controlled digital version of the kyat. This isn’t about innovation. It’s about control. The digital kyat will let the government track every transaction, freeze accounts remotely, and cut off access to anyone they label a threat.There’s no privacy. No anonymity. No freedom. Unlike Bitcoin, the digital kyat will be fully monitored. The CBM is building a system that makes crypto look like a luxury you can’t afford. They want you to think: “At least the digital kyat is legal.” But it’s not freedom-it’s surveillance with a better interface.
Who’s Really at Risk?
You don’t have to be a trader to get caught. Here’s who’s most vulnerable:- Students receiving crypto from overseas relatives
- Small business owners accepting USDT as payment
- People using crypto to send money to family abroad
- Anyone who held crypto in a wallet linked to a Myanmar bank account
- Former crypto exchange employees or promoters
Even if you sold your crypto in 2022 and never touched it again, if your bank account was ever linked to a wallet, it could still be flagged. The CBM keeps records for years. They don’t forget.
What Should You Do If You’re in Myanmar?
If you’re currently in Myanmar and have crypto:- Do not convert it to kyat through any local exchange or person.
- Do not use your Myanmar bank account to buy, sell, or receive crypto.
- Do not mention crypto on social media or in phone calls.
- If you have crypto on an overseas exchange, keep it there. Don’t withdraw it to a local wallet.
- Consider moving your funds to a non-Myanmar wallet and disconnecting all ties to local financial systems.
If you’ve already been affected-your account is closed, or you’ve been questioned-don’t try to fight it alone. Contact international human rights groups or legal aid organizations that specialize in Myanmar cases. Local lawyers won’t help you. The system is designed to crush resistance.
Why This Matters Beyond Myanmar
Myanmar isn’t just a cautionary tale. It’s a blueprint. Governments around the world are watching how the CBM enforces its ban. If they see that account closures and jail time stop people from using crypto, they might copy it. The U.S., EU, and India have all debated tighter controls. Myanmar shows what happens when a government decides money is too dangerous to leave in citizens’ hands.For now, the only way to survive in Myanmar’s crypto landscape is to disappear from it. Not because crypto is bad-but because the system won’t let you use it without paying a price you can’t afford to lose.
Can I still use Bitcoin in Myanmar without getting caught?
No. Using Bitcoin, Ethereum, USDT, or any other cryptocurrency in Myanmar is illegal under the Central Bank of Myanmar Law. The CBM actively monitors bank transactions, social media, and digital footprints. Even holding crypto in a wallet linked to your bank account can trigger an account closure and legal investigation. There is no safe way to use crypto within Myanmar’s current legal system.
What happens if I just hold crypto and never trade it?
Holding crypto alone won’t trigger action-but if your wallet was ever connected to a Myanmar bank account, or if you received crypto through a local channel (like a Telegram group or Facebook page), the CBM can trace it. They don’t need proof you traded it. They only need proof you owned it. Many people have been punished simply for having crypto in their wallet, even if they never sold or spent it.
Is USDT legal in Myanmar if I use it for remittances?
No. Using USDT for remittances is one of the most common reasons people get arrested. The CBM considers any transfer of crypto across borders as illegal foreign exchange. Even sending $50 to a family member in Thailand using USDT can lead to account closure, fines, or imprisonment. There are no exceptions for family support.
Can I open a new bank account after mine was closed for crypto use?
Almost certainly not. Once your account is closed for crypto violations, your name is added to a CBM blacklist. Banks share this list internally. Even if you try to open an account under a different name or at another bank, they will cross-check your ID and deny you. Many people have been permanently locked out of the formal banking system.
What’s the difference between the CBM’s ban and the NUG’s legalization of USDT?
The National Unity Government (NUG) declared USDT legal in areas under its control as a way to bypass junta-imposed financial restrictions. But the CBM, which controls most of the country’s banking system and major cities, still treats USDT as illegal. If you use USDT in a NUG-controlled area but travel to a CBM-controlled city, you can still be arrested. There is no nationwide legal clarity-only zones of risk.
Is mining cryptocurrency still possible in Myanmar?
Yes, but it’s extremely dangerous. Underground mining operations still exist, often using illegally connected power. However, the CBM has increased raids on residential buildings suspected of crypto mining. Those caught face imprisonment, equipment confiscation, and fines. Many miners have fled to Thailand and Laos, where regulations are less severe and enforcement is weaker.
Will the digital kyat replace crypto in Myanmar?
It won’t replace crypto-it will replace freedom. The digital kyat is a government-controlled currency with full tracking capabilities. Unlike Bitcoin, it allows the state to freeze accounts, block transactions, and monitor every payment. It’s not an alternative to crypto-it’s the opposite: the ultimate tool for financial control. The CBM wants you to abandon crypto not because it’s risky, but because it’s uncontrolled.
What Comes Next?
The future of crypto in Myanmar isn’t about technology. It’s about power. The CBM isn’t trying to fix a problem-they’re trying to eliminate any challenge to their control over money. As long as the current regime holds power, crypto will remain a criminal act. The only safe path is to avoid it entirely.If you’re outside Myanmar, don’t assume this is just a local issue. What happens here sets a precedent. Governments watching Myanmar’s crackdown may decide to follow suit. The lesson is clear: when a state decides money must be owned by them, freedom is the first thing to disappear.
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