Vietnam Takes Cryptocurrency Center Stage: Crafting a Legal Symphony to Harmonize Security and Combat Financial Risks by 2025

In a strategic move, the Vietnamese Government has entrusted the Ministry of Finance with the task of researching and formulating a comprehensive legal framework to either ban or regulate crypto assets by May 2025. This initiative aligns with the government's commitment to combat money laundering, terrorist financing, and the financing of weapons of mass destruction, as outlined in Government Decision 194/QĐ-TTg dated February 23, 2024. Beyond crafting the legal framework for crypto asset management, the directive emphasises the importance of implementation, including enhancing awareness among management and supervisory agencies about associated risks. Despite the global prominence of Bitcoin, Vietnamese authorities have consistently reiterated that cryptocurrency is not recognized as legal currency or a legitimate means of payment within the country. The decision is part of a broader set of 17 action programs dedicated to fulfilling Vietnam's commitments in preventing financial crimes and addressing concerns related to the proliferation of mass destruction weapons. Notably, the State Bank of Vietnam had previously acknowledged, during a National Assembly session in October 2022, that cryptocurrencies like Bitcoin and Ethereum are not legally issued currencies by central banks but rather creations facilitated by organisations and individuals using algorithms on computer networks. While various countries adopt different approaches to cryptocurrency regulation, Vietnam's multifaceted strategy underscores its commitment to addressing potential risks and enforcing financial security measures.