MoF rejects digital asset trading proposal

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The proposed initiative would have been set to launch in July next year as part of a broader effort to modernise the country’s financial infrastructure.

The Ministry of Planning and Investment had put forward the proposal to introduce a controlled sandbox for digital asset exchanges in new financial hubs planned for Ho Chi Minh City and Danang. These controlled environments allow startups to test novel ideas - including blockchain applications and digital banking solutions - without immediately falling under traditional regulatory constraints. This reduces compliance costs and legal risks, fostering a more dynamic fintech ecosystem.

However, the MoF has expressed reservations, highlighting Vietnam’s lack of a clear legal framework for digital assets and cryptocurrencies.

"Managing these assets requires a comprehensive regulatory process covering issuance, ownership, trading, service licensing, and data security," the MoF stated. "Without proper oversight, there could be significant risks to national financial stability."

In light of these concerns, the ministry has urged policymakers to consult the State Bank of Vietnam, given that cryptocurrencies and digital assets could function as payment instruments in financial transactions.

The MoF also recommended that the government, rather than individual agencies, oversee the implementation of any pilot scheme involving digital assets. Additionally, it suggested removing the specific timeline for launching cryptocurrency trading from the proposal.

Vietnam currently lacks a formal legal definition for digital and virtual assets, including widely recognised cryptocurrencies like Bitcoin and Ethereum.

Existing regulations only address electronic money pegged to fiat currency, such as prepaid bank cards and e-wallets. This regulatory vacuum has led many Vietnamese startups to register abroad - particularly in Singapore and the US - before operating domestically, undermining Vietnam’s competitive advantage and resulting in lost tax revenue. Industry experts warn that the absence of clear guidelines also exposes investors to fraud and transaction risks.

Despite the lack of regulation, Vietnam has emerged as a major player in the global digital asset space. According to the Vietnam Blockchain Association, between 2021 and 2022, the country ranked among the top three worldwide in cryptocurrency adoption, with approximately 21 per cent of the population owning digital assets - trailing only the UAE and the US. Market analytics firm Chainalysis reported that digital asset inflows into Vietnam reached $120 billion in 2023.

The proposed sandbox model is not unprecedented. Financial powerhouses such as Singapore, Hong Kong, the UK, and Australia have successfully implemented similar frameworks to support fintech innovation.

Vietnam to become digital asset hub Vietnam is projected to become a second home for leading global tech corporations and a cradle for digital assets in the coming years.

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