Raffles, Bonds and Crypto Are Funding Myanmar’s Armed Resistance

More than two years after Myanmar’s military toppled the country’s elected government and set off a bloody civil war, resistance groups pushing back against the junta’s rule are finding ever more clever and high-tech ways of bankrolling their fight.

Straightforward donations from the country’s diaspora from Sweden to Singapore continue pouring into what remains a largely crowdfunded campaign, but bonds, real estate auctions and mining leases are now adding to the mix.

The National Unity Government, an opposition shadow administration run from hiding and exile, launched a digital currency last year in an end run around banks in the junta’s grip and is now on the cusp of opening its own online bank.

“While the NUG would clearly love more state sponsorship and support, whether lethal assistance or non lethal assistance, from Western countries, it’s just not in the cards right now, and so they’ve really had to be self-reliant,” said Zachary Abuza, a professor at Washington’s National War College who has studied Southeast Asian insurgencies for 30 years.

“And they’ve done so through some of the most tech-savvy and creative, and dare I say, playful, ways,” he told VOA. “They really have flipped the script.”

Not so real estate

The fighting is estimated to have killed more than 30,000 people, displaced upwards of 1.5 million internally and sent thousands more fleeing to neighboring countries since the February 2021 coup.

Hundreds of local militias have taken up arms across the country to fight back, often teaming up with ethnic minority-led rebel armies that have been fighting the military for territory for decades. The NUG commands and funds many of the militias and has allied with some of the largest rebel armies.

The NUG refused VOA’s requests for an interview and ignored its emails.

At a news briefing in January, though, its minister for planning, finance and investment, Tin Tun Naing, said the NUG had raised over $100 million to date. He said nearly half had come from the sale of so-called Spring Revolution bonds, named after what resistance groups have dubbed Myanmar’s “Spring Revolution.” The bonds earn no interest and will be paid back only if and when the junta falls.

He said the NUG had also collected more than $1.4 million in taxes across the roughly half of Myanmar that resistance groups are believed to control or contest and would soon start selling leases to gem mines largely still in junta hands. The NUG reportedly sold its first mining lease to an anonymous buyer for $4 million in February.

The shadow government has also been auctioning off shares in real estate owned or seized by the military, including a lakeside villa junta leader Min Aung Hlaing uses when in Yangon, Myanmar’s commercial capital. As with the mining leases, investors cannot actually use what they’ve bought until the resistance wins.

Abuza said the real estate auctions are especially popular and are likely to outstrip the NUG’s bond earnings eventually, since people could actually turn a profit from the property.

While often arriving in dribs and drabs, simple donations from around the world are also believed to be adding up to millions of dollars for the NUG and others.

From her New York City home, Myanmar native Khin Moe auctions off rings, pendants and other glitzy jewelry online for the cause. At up to $20 a raffle ticket, she said she can rake in well over $1,000 per piece.

She and a circle of friends and family have also bought some $10,000 worth of Spring Revolution bonds. Khin Moe said her sister, who also lives in New York, even purchased a unit in an apartment block the NUG has designed and promised to build, someday, on land the Myanmar military still holds.

“They [the junta] want to control everybody else with power. … They took all the prisoners, and they killed the people and students. The worst part is they took everybody else’s freedom; we cannot accept it,” she told VOA.

“We trust … the NUG leaders [can] help and support whatever people need in Burma, that’s the reason why we trust them, and we bought the bonds,” she added, using another name for Myanmar. “We know this kind of bond doesn’t make interest money, but we support because we trust.”

Getting that money into the hands of the people it is meant for on the ground in Myanmar is another matter.

With the coup, the military took control of Myanmar’s central bank and soon ordered local banks to watch for and block accounts suspected of funneling funds to resistance groups. It has arrested those who transferred money through suspect accounts and sentenced them to 10 years in jail with hard labor.

The informal “hundi” money transfer system, which uses networks of affiliated agents, helps them skirt the banks but has its limits.

As another workaround, the NUG last year launched the Digital Myanmar Kyat, or DMMK, a cryptocurrency pegged 1 to 1 to the real kyat based on blockchain technology designed to be difficult or impossible to block. It also launched a mobile wallet, NUGPay, for users to hold and trade the digital coins.

While still in its infancy, DMMK is helping the resistance move money into and around the country, said Soe, a blockchain expert who asked his full name not to be used for safety reasons.

Soe trains nongovernment charities in Myanmar conflict zones in using cryptocurrencies and other blockchain tools to evade the military’s banking restrictions and its suspected eavesdropping on mobile networks, and he stays in touch with some militias and rebel armies.

“The main thing is that the revolution needs funding support from the people [of Myanmar] and other people from other countries. Using crypto is one of the safest ways to support,” he told VOA. “Not only the Myanmar military, [but] all the governments around the world cannot control transactions on the blockchain.”

DMMK’s limited exchangeability with other cryptocurrencies, though, and the need for physical agents to cash in and out, have raised doubts about its ultimate utility to the resistance. Soe said the scattered details the NUG has revealed about its plans for its forthcoming Spring Development Bank could solve some of those problems, in part by using a blockchain network more compatible with other cryptocurrencies than the one hosting DMMK.

The NUG has previously announced launch dates for the online-only bank that have come and gone. In late June, local media reported on its plans to take the bank live sometime this month.

Myanmar’s armed resistance, though, scrapes by on a fraction of the billions of dollars at junta disposal. If the NUG gets its bank operating, though, it could prove a vital new lifeline, said Abuza, who has had confidential conversations with the NUG about its plans.

“I have seen the details of the Spring Bank and what they’re offering and the interface that they’re going to use online, and I think it will be popular,” he said.

“It will be a source of revenue for the NUG, but it will also facilitate their other funding, including the lottery, land sales, bond sales, etc.,” he said. “So, if they can pull this off … it will be very important for them to sustain the revolution.”