US Sanctions on Myanmar Crypto Entities: What You Need to Know

On September 8, 2025, the U.S. Treasury Department dropped a major hammer on cryptocurrency fraud networks based in Myanmar. Nine entities operating out of Shwe Kokko, a lawless zone on the Thai-Burmese border, were officially sanctioned under U.S. law. These aren’t just random scammers. They’re part of a highly organized, violent criminal network protected by the Karen National Army (KNA), a militia group with deep ties to Myanmar’s military junta. The goal? To steal billions from Americans through fake crypto investment schemes - and they’re doing it with forced labor, torture, and human trafficking.

How These Scams Work

Picture this: You see an ad online - "High-paying job in Thailand. No experience needed. Work from home. $3,000/month." It sounds too good to be true? It is. Victims - often from Southeast Asia, but sometimes even from the U.S. - are lured in with promises of remote tech jobs. Once they arrive at one of the compound-style scam centers in Shwe Kokko, their passports are taken. They’re locked in. For 12 to 18 hours a day, they’re forced to call Americans, pretending to be crypto traders, bank agents, or tech support. Their job? Convince people to send money into fake wallets labeled as "high-yield crypto funds" or "AI trading bots." These aren’t small-time operations. Each compound houses hundreds of victims, all under armed guard. The money they steal? It flows through cryptocurrency exchanges, mixers, and decentralized platforms to hide its trail. The KNA takes a cut. The top bosses - including Saw Chit Thu and his sons - get rich. And the victims? Many are beaten if they don’t meet daily quotas. Some have died. The U.S. Treasury estimates that in 2024 alone, Americans lost over $10 billion to these scams. That’s more than the entire GDP of some small countries. And Myanmar’s Shwe Kokko is ground zero.

What the Sanctions Actually Do

The sanctions, issued by OFAC (the Office of Foreign Assets Control), don’t just freeze bank accounts. They cut off the entire ecosystem. Here’s what happens when an entity is sanctioned:

• All U.S.-based assets tied to the entity are frozen - no exceptions.
• U.S. citizens and companies are banned from doing any business with them - even sending a single dollar.
• Any financial institution handling U.S. transactions must block payments to or from these entities.
• Foreign banks that deal with them risk losing access to the U.S. financial system.

The nine Myanmar-based entities targeted include crypto wallet providers, payment processors, and fake "investment firms" that operate as fronts for the scams. Ten more were hit in Cambodia, showing this is a regional problem - not just a Myanmar issue.

Why Crypto? Why Now?

Crypto is the perfect tool for these criminals. It moves fast. It’s global. It’s hard to trace. Unlike traditional banks, many crypto platforms don’t require ID verification - especially on decentralized exchanges. Scammers use this to turn stolen dollars into Bitcoin, Ethereum, or stablecoins, then wash them through multiple wallets before cashing out.

The U.S. didn’t act randomly. This was years in the making. The Treasury Department has been quietly tracking these networks since 2022. They’ve worked with the FBI, Secret Service, and international partners in Thailand, Cambodia, and Malaysia to map out the money flows. The $10 billion loss in 2024 was the tipping point. The U.S. realized: if they don’t act now, the damage will keep growing.

Who’s Behind It?

The Karen National Army (KNA) isn’t just a local militia. It’s a transnational criminal organization with its own army, police force, and courts - all funded by crypto scams. The KNA controls Shwe Kokko because Myanmar’s military turned a blind eye. In exchange for a share of the profits, the junta lets the KNA operate freely. That’s why the U.S. didn’t just sanction the scam companies. They also named Saw Chit Thu, his two sons, and the KNA itself as sanctioned entities.

This is a key shift. Before, sanctions targeted individual fraudsters. Now, they’re going after the entire structure - the protectors, the enablers, the financiers. The U.S. is using four different executive orders at once:

• E.O. 13851 - Targets transnational criminal organizations.
• E.O. 13694 - Addresses malicious cyber activity.
• E.O. 13818 - Punishes serious human rights abuses.
• E.O. 14014 - Strikes at those undermining Myanmar’s stability.

This isn’t just a financial move. It’s a legal and moral statement: these aren’t just scams. They’re slavery.

What This Means for You

If you’re an American investor, this doesn’t change your daily crypto habits - but it should change how you think about "guaranteed returns." Here’s what to watch for:

• Too-good-to-be-true offers: "Earn 10% daily on Bitcoin?" That’s a scam. Real crypto doesn’t work like that.
• Unregulated platforms: If a site doesn’t have KYC (know your customer) checks, avoid it.
• Job offers from overseas: If someone contacts you out of the blue with a "remote crypto job," verify it. Many victims were recruited this way.

The U.S. government isn’t asking you to track down these criminals. They’re asking you to stop giving them customers. Don’t fall for the hype. Don’t send money to strangers. If it sounds like a miracle, it’s a trap.

What Happens Next?

This is just the beginning. The Treasury says this action "builds on a series of actions taken in the last several months." That means more sanctions are coming. They’re likely to target:

• Crypto exchanges that ignore U.S. compliance rules
• Chinese and Russian firms that help launder the stolen funds
• Banking partners in the UAE and Turkey that process payments for these networks

There’s also pressure on Thailand and Cambodia to crack down on their own scam hubs. The U.S. has already started sharing intelligence with their governments. If they don’t act, they could face secondary sanctions - meaning even their banks could be cut off from the U.S. financial system.

Meanwhile, in Shwe Kokko, the scammers are already adapting. Some are moving operations to Laos. Others are using AI-generated voice scams to avoid human interaction. But the U.S. is ready. They’ve built a database of over 1,200 scam domain names and wallet addresses. Every time a new one pops up, they track it. And they freeze it.

Final Thought

This isn’t just about money. It’s about people. Thousands of victims - some as young as 16 - are locked in cages, forced to lie to strangers every day. And American families are losing their life savings because someone clicked on a Facebook ad. The U.S. sanctions are a warning: you can’t hide behind borders when you’re stealing from Americans. And you can’t hide behind crypto when you’re committing crimes against humanity.