The Vietnamese Prime Minster Pham Minh Chinh highlighted the need for crypto regulation, signaling the government’s intent to study crypto regulation. Digital assets have reached mainstream prominence with the nation topping the list in Chainalysis’s Global Crypto Adoption Index. The rising use of crypto assets among Vietnamese citizens, in spite of an absence of official recognition- has propelled the government in this direction, aiming to prioritize the protection of consumer assets.
Crypto Regulation in Vietnam
The online news portal VnExpress reported Prime Minister Chinh indicated a possible AML or Anti-Money Laundering Bill. He also reflected that the government should also recognize a crypto amendment considering regulation and prevention of financial crimes.
Accepting the rapid crypto transformation, the PM stated:
“It is necessary to study appropriate sanctions, and should assign the Government to make detailed regulations.”
Current Crypto Scenario in Vietnam
The national government in Vietnam does not offer authenticate Bitcoin and other cryptocurrencies as valid payment methods. Digital tokens are rather placed in a poorly-defined segment under investments. Chainalysis’s September 2022 report reflects Vietnam being the global leader in crypto adoption across both 2021 and 2022. The country has been characterized by very high purchasing power and mass adoption across multiple crypto platforms- be it DeFi, Centralized or Decentralized P2P.
The Need for Regulation
The growing use of cryptocurrencies has been misutilized by people with malicious intent as a channel for laundering and financing illegal activities including acts of terrorism. Mr. Nguyen Manh Hung, a Standing Member of the nation’s Economic Committee, explained how the laundering of money by electronic means is an existential risk.
Mr. Dao Hong Van(Deputy of the Hung Yen Province) expressed similar concern, commenting the revised AML Bill needs to be functional and regulate crypto transactions in order to prevent digital assets from becoming a loophole for money laundering.
The Deputy Chairman of Vietnam’s National Dense and Security Committee Nguyen Minh Duc illustrated the process of money laundering using digital assets to bypass state supervision. Criminals use fiat currency to buy digital assets and transfer them abroad without getting halted by state control. The virtual asset is then converted back into. The process is a bit similar to using online games for buying virtual tokens. Addressing the Ho Chi Minh City team, Mr. Duc also explained multiple money laundering tricks used by criminals to move “dirty” money from one place to another.
“If money launderers take advantage of this loophole to transfer money to their relatives, travel, study, and receive medical treatment abroad… then the legal corridor of the Law on Anti-Money Laundering has met the requirements. request to control this transaction? It is recommended that the drafting agency recalculate this part,” concluded Mr. Duc.
The nation’s legislators have been advocating for crypto adoption for quite some time. Their combined efforts have contributed to the massive rise in digital asset usage among Vietnamese citizens. The Deputy PM for General Economics Le Minh Khaio requested the Finance Ministry to observe, amend laws and create a standardized crypto framework with suitable regulations in March. Meanwhile, the Prime Minister had also directed the State Bank of Vietnam, the nation’s central bank to examine and conduct a CBDC pilot test.
According to the latest reports, the National Assembly of Vietnam will be discussing the anti-money laundering(AML) bill on 1st November and reach a conclusion by the end of the 4th session, to be held on November 15. The process will most likely be approved, and benefit the overall crypto community across Vietnam.