Myanmar Home Affairs Cautions Citizens Against Growing Crypto Scams - Bitsonline

Myanmar Home Affairs Cautions Citizens Against Growing Crypto Scams

The government of the Southeast Asian country of Myanmar has cautioned its citizens to keep a distance from trading cryptocurrencies amid the influx of bitcoin-related scam. In a statement, Myanmar’s Ministry of Home Affairs advised its citizens to turn their backs on crypto-associated multi-level marketing investment opportunities.

Also read: Former Goldman CEO Gary Cohn Says Global Cryptocurrency Is Possible

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Scammers Target the Naive

The Myanmar government’s warning deemed cryptocurrencies to be “unstable”. Moreover, it advised interested citizens to explore digital currencies without investing any money into them, as reported by Frontier Myanmar. More commonly, scammers target people from rural areas, luring them into investing into multi-level marketing Ponzi schemes.

The official statement from Home Affairs read:

“Cryptocurrency companies that were based outside Myanmar have started operating inside Myanmar. They have mostly focused on attracting investors in rural areas who have no experience or understanding about cryptocurrencies.”

Last year, bitcoin witnessed a tremendous level of growth in its price and popularity. Fellow cryptocurrencies also gained a certain level of fame (and others infamy). The growth of bitcoin saw many developers launch their own crypto ventures through a capital-raising process known as Initial Coin Offerings (ICOs).

Explore Crypto but Don’t Invest

The rise in cryptocurrencies’ popularity has also enticed bad actors to host different types of scams. Hoping to get rich quick, investors fall into such Ponzi schemes offering ludicrous rewards. To add to the chaos, investors do not explore projects fully and just put in money hoping to hit the jackpot.

The statement from the Home Affairs details:

“These groups are attracting people to invest in cryptocurrency platforms using incentives. Digital currencies … are unstable and if anyone in Myanmar invests in them it may affect to country economy. So people should only study about cryptocurrencies.”

Myanmar

FirstCoin Club, a multi-level marketing project, was slowly gaining popularity in Myanmar. According to the scheme, investors would invest $200 USD and receive daily interest rates of 3 to 7.5 percent. Earlier this year, the FirstCoin Club was flagged and classed as a Ponzi scheme. At the time bitcoin was approaching the $20,000 mark, FirstCoin also peaked at $18. However, the coin is currently valued at $0.020 and is still traded on multiple exchanges, as per CoinMarketCap.com.

The Myanmar government is moving swiftly, akin to other Southeast or South Asian countries such as India and Cambodia, in taking a strict approach toward crypto activities. Recently, India Central Bank banned banks from facilitating crypto businesses in order to cripple the crypto market in the country. Two crypto businesses have challenged the decision in the Indian High Court.

The flow of Ponzi schemes in the crypto sector is on the rise but is more widespread in developing countries. At present, the government of Myanmar has only cautioned its citizens to tread carefully when dealing with cryptocurrencies. The move was intended to safeguard its citizens from Ponzi schemes, rather than to impede the growth of the growing industry. 

Will Myanmar follow India in crippling the crypto ecosystem or ultimately become a crypto friendly nation? Share your views in the comments section below.


Images via Maxpexels, Pixabay 

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