Vietnam to Soon Have a Legal Framework for Virtual Assets

Le Minh Khai, the deputy prime minister of Vietnam has directed the country's finance ministry to draft regulatory laws for the digital assets sector. Management of virtual assets has emerged as a subject of importance in Vietnam among other nations. Binding digital assets in laws would not only bring the category under the nation's economic framework, but also lose risks of being exploited for illicit activities. The ministry of justice, information, and communications along with the State Bank of Vietnam have also been roped in for finetuning the crypto laws.

Vietnamese officials have been put up to the task of identifying different spheres around the digital assets category. These include research on the nature of virtual assets and analysis on foreign experiences with virtual money.

The relationship of virtual assets with fiat currency and physical assets has also been noted as a topic of research that will shape the crypto laws in Vietnam, a report by Vietnam Net said.

In recent times, several nations have come forward to support a “regulate-over-restrict" approach.

At present, India, Australia, Dubai, and Brazil have taken their first steps towards making the crypto sector adhere to their respective laws.

The US and the UK have also released orders around the formulations of laws to monitor and regulate the crypto sector.

Since crypto assets are decentralised and mostly untraceable in nature, their chances of being used to execute illicit activities like money laundering and terror funding are also high. This is one big reason why governments around the world are trying to get the sector on its grid.

Capable of facilitating instant transactions of large sums, cryptocurrencies are also seen as a threat that could challenge the positions of physical currencies. In order to eradicate this fear, governments are exploring ‘CBDCs' or central bank digital currencies. CBDCs are built like cryptocurrencies on blockchain technology, but they are controlled by the central banks.

The State Bank of Vietnam has also been instructed to lead the research, creation, and pilot use of virtual money by 2023.

As per blockchain research firm Triple-A, Vietnam has over 5 million crypto holders, making for over 6 percent of its population.