Vietnam's Prime Minister, Pham Minh Chinh, has urged for the submission of proposals for a legal framework regulating cryptocurrencies by the end of this month.
The Ministry of Finance (MOF) and the State Bank of Vietnam (SBV) have been tasked with leading the development and submission of this legal framework to manage digital assets and currencies, with a deadline set for March.
Under this directive, Prime Minister Chinh has signed Directive No. 05 aimed at fostering national growth to achieve an 8% target by 2025. The call for proposals regarding the legal framework for digital currencies is a crucial element of this initiative.
"The Party, Government, National Assembly, and the people all support this direction. It is time for action, not withdrawal," emphasized the Head of Government.
Despite not being officially recognized as digital currency in Vietnam, many businesses are currently registered in other countries and operating within Vietnam. This practice not only puts them at a disadvantage but also leads to a loss in tax revenue for the country.
To address these issues, the MOF and SBV have been instructed to present a legal framework for digital currencies within the stipulated timeframe.
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The implementation of a legal framework is expected to facilitate businesses in accessing capital from banks and make investments and funding more readily available. Transparency associated with such regulations could also minimize transaction risks, aligning with Vietnam's plans to impose taxes on crypto transactions and digital assets.
An Overview of Vietnam's Legal Framework for Digital Currency
Vietnam, currently ranking 7th globally in cryptocurrency ownership, has seen a surge in interest, especially with the emergence of the Pi Network (PI), prompting warnings from local authorities.
However, the government is yet to provide a clear definition of virtual currencies and assets. Efforts have been made to incorporate regulations on digital assets under the Law on Digital Technology Industry, with crypto being classified as digital data.
Earlier this year, the National Assembly's Standing Committee aimed to define and classify digital assets based on various criteria. Discussions have been held regarding the establishment of a digital asset exchange, emphasizing the need for a controlled testing mechanism.
Furthermore, the Vietnamese Government plans to establish Financial Hubs in Ho Chi Minh City and Da Nang by 2025, offering a strategic platform for financial activities.
In line with these developments, the Prime Minister has directed the MOF and MOST to craft policies on digital assets and sandboxes by the second quarter of 2025. This move signifies Vietnam's commitment to fostering a conducive environment for the regulation and growth of digital currencies and assets.