The United States Department of the Treasury has thrown down the gauntlet against the Karen National Army (KNA), a militia group operating in Myanmar, by imposing sanctions due to its alleged involvement in a slew of crypto-related scams and other nefarious activities. Announced on May 5, these sanctions aim to curb the group’s “pig butchering” schemes, which have siphoned off billions of dollars from unsuspecting victims — many of them U.S. citizens.
A Dark Web of Deceit
The KNA, led by Saw Chit Thu along with his sons, Saw Htoo Eh Moo and Saw Chit Chit, stands accused of running elaborate scams that prey on the unwary. The so-called “pig butchering” scam is a particularly insidious form of fraud. Scammers build rapport with victims over time, often through social media, only to later convince them to invest in bogus crypto schemes. It’s a slow game, but highly effective — and devastating.
“These scams are designed to bleed victims dry by gaining their trust and then exploiting it,” explained Ava Thompson, a cybersecurity analyst. “The scale at which these operations are conducted is alarming, especially when combined with human trafficking networks.”
Indeed, the Treasury’s Office of Foreign Assets Control (OFAC) is no stranger to wielding sanctions as a tool against crypto-offenders. Past targets have included terrorist groups in the Middle East, cybercrime units, and even privacy-centric technologies like Tornado Cash. According to the Treasury’s recent press release, the KNA’s activities are just the latest addition to this growing list of crypto malfeasance. This follows a pattern of crackdowns, as seen in our coverage of the Cambodian Huione Group’s involvement in crypto activities.
The Wider Impact on Crypto Markets
The Treasury’s intervention comes as crypto markets continue to grapple with trust issues. The FBI has previously reported that American citizens lost a staggering $9.3 billion to crypto scams in 2024, marking a 66% increase from the previous year. Those most affected? Individuals over 60, who accounted for $2.8 billion of those losses.
“This isn’t just a blip on the radar; it’s a seismic shake in the crypto landscape,” noted Emily Carter, a blockchain consultant. “The implications of these scams extend beyond financial loss, eroding confidence in the crypto ecosystem as a whole.” For a deeper dive into the recent surge in crypto losses, see our coverage of the spike in April.
As scammers grow bolder, they exploit not just technological vulnerabilities but also emotional ones, a tactic that has proven highly effective in Southeast Asia. According to blockchain intelligence firm TRM Labs, these scams were responsible for over $4.4 billion stolen in 2023 alone. With the KNA’s operations now under the spotlight, there’s hope that such figures might start to dwindle.
A Broader Context of Conflict
The sanctions against the KNA also serve a dual purpose, targeting not just financial crimes but also the group’s involvement in human trafficking and cross-border smuggling. While the U.S. continues to refer to Myanmar as “Burma,” a nod to its refusal to acknowledge the military regimes post-1989 coup, the KNA operates in the southeastern region along the Thailand border—a hotspot for illicit activities.
By striking at the KNA, the Treasury hopes to cut off a significant node in a network of criminal enterprises that profit from human misery and technological deception. Yet, questions remain about the efficacy of sanctions in a digital age where assets can be easily obfuscated.
Looking Ahead
As the crypto world continues to evolve, so too do the tactics of those who seek to exploit it. The Treasury’s decisive action against the KNA sends a powerful message to other would-be scammers. But will it be enough to deter future crimes? Only time will tell.
For now, the crypto community remains on high alert, with stakeholders urging users to exercise caution. The battle against crypto crime is far from over, and the stakes—both financial and ethical—have never been higher.
Source
This article is based on: US Treasury sanctions Myanmar militia group for alleged crypto scams
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Steve Gregory is a lawyer in the United States who specializes in licensing for cryptocurrency companies and products. Steve began his career as an attorney in 2015 but made the switch to working in cryptocurrency full time shortly after joining the original team at Gemini Trust Company, an early cryptocurrency exchange based in New York City. Steve then joined CEX.io and was able to launch their regulated US-based cryptocurrency. Steve then went on to become the CEO at currency.com when he ran for four years and was able to lead currency.com to being fully acquired in 2025.
