Myanmar’s National Unity Government has declared Tether (USDT) an official currency. Tether is a dollar-based stablecoin, which can now be used locally in Myanmar.
According to a Bloomberg report, the NUG will accept Tether for its ongoing fundraising campaign. The NUG is being led by the supports of former prime minister Aung San Suu Kyi, who was toppled by the military in February this year. The supporters aim to raise $1 billion through the sale of NUG-issued bonds. So far, it has raised about $9.5 million through the sale of Spring Revolution Special Treasury Bonds.
Tin Tun Naing, NUG Finance Minister, in a Facebook post said USDT will be put to domestic use to make it easy and speed up the current trade, services and payment systems. This decision comes as a blow to Myanmar’s central bank as it had declared blockchain-powered cryptocurrencies illegal in the country. It has also threatened lawbreakers with imprisonment and hefty fines.
Experts say the adoption of Tether is on the rise. However, US regulators have fined Tether, as per a study, due to its involvement in shady activities. It should be noted that Tether is not run or operated or regulated by the US federal bank. USDT is a stablecoin, which is equivalent to $1. Basically, it mirrors the US dollar. CoinMarketCap states that the token’s peg to the USD is achieved by maintaining a sum of commercial paper, fiduciary deposits, cash, reserve repo notes and treasury bills in reserve that is equal in USD value to the number of USDT in circulation.
The study highlights that if Tether’s price suddenly collapses, the transfers could fail. But experts believe that in the long term, stablecoins that are backed by currency will be more widely used for transfers.