Abstract:

In 2024, Vietnam ranked 5th globally in terms of interest in digital assets and 3rd in the world for using international trading platforms. Currently, 17 million Vietnamese individuals own digital assets, with the total market value exceeding 100 billion USD. Informal digital asset trading is fueling a vast underground economy, but Vietnam still lacks an official legal framework for cryptocurrency and digital assets.

According to Directive No. 05/CT-TTg dated March 1, 2025, the Ministry of Finance and the State Bank are tasked with proposing a legal framework for managing and promoting digital assets and cryptocurrency by March 2025. Both State management agencies and investors are seeking a robust legal framework for cryptocurrency in Vietnam. This article reviews regulations from leading countries to guide the development of cryptocurrency and digital asset laws in Vietnam.

  1. Concepts and legal nature of cryptocurrency

The world is witnessing a significant rise in cryptocurrency. Many countries worldwide have quickly embraced this trend and made notable progress in building regulatory frameworks, testing technologies, and developing related applications. The demand for cryptocurrency trading has also surged. According to data from the analytics and aggregation firm – CoinGecko, the total market value of cryptocurrencies reached a high of nearly $3.2 billion on November 14, 2024, in Asia. According to the second annual “Henley Crypto Adoption Index”, Singapore ranks as the top crypto hub with a score of 45.7 out of 60, thanks to its competitive advantages in areas such as technological innovation, legal frameworks, and infrastructure development. Hong Kong ranks second, followed by the United Arab Emirates. Major countries, including the US, have also launched aggressive support policies to welcome a new wave of cryptocurrency investment.

In 2024, Vietnam ranked 5th globally in terms of interest in digital assets and 3rd globally in terms of the use of international trading platforms. Currently, 17 million Vietnamese people own digital assets, with the total market value exceeding 100 billion USD. Informal digital asset trading is fueling a vast underground economy, but Vietnam still lacks an official legal framework for cryptocurrency and digital assets [1]. The cryptocurrency trading market is becoming increasingly dynamic, underscoring the urgent need to develop a regulatory framework for this type of “asset”. In addition to Bitcoin (BTC), the first major cryptocurrency to appear on the market in 2009, which has been approved by the US Securities and Exchange Commission (SEC) for ETF trading (a type of investment fund traded on a stock exchange that directly invests in Bitcoin), many other cryptocurrencies have emerged and gained significant popularity, such as Ethereum (ETH), Tether (USDT), XRP, and DigiByte (DGB), etc., [2]

The terms “cryptocurrency”, “digital currency”, and “virtual currency” are often used interchangeably and are commonly understood to have similar connotations:

– “Digital currency” or cryptocurrency is broadly defined by organizations to include coins, cryptocurrencies, and digital money (electronic money, electronic currency, cyber cash). Digital currency typically has two sources of issuance: from the central bank and/or the private sector, including businesses and individuals. For digital currencies issued by private entities, such as BTC, ETH, and GDB, the payment or transfer of digital funds is verified by independent, unknown third parties, without relying on a central authority or registration [3].

– The concept of “virtual currency” is defined by the Financial Action Task Force (FATF) as a digital representation of value that can be traded electronically and serves as a method of exchange, a unit of account, and/or a means of storing value, but is not recognized as having legal tender status. Virtual currency is not issued or guaranteed by any country or territory and only fulfills the functions mentioned above based on the agreement within the virtual currency user community [4]. The International Monetary Fund (IMF) defines “virtual currency” as a digital representation of value, issued by a private developer and listed in its own unit. It can be seized, stored, accessed, and traded online, and can be used for various purposes as long as the parties involved in the transaction agree to its use [5].

– Electronic money (e-money) is a concept officially defined in numerous legal documents across various countries and international financial and monetary institutions. According to the official website of the European Commission (EC), e-money is “a digital alternative to cash. It allows users to make cashless payments with money stored on a card or a phone, or over the Internet” [6].

– According to the World Bank, e-money is defined as a “store of value” in the digital form of a currency, which can be exchanged at face value upon request and accepted as a means of payment [7]. The European Central Bank (ECB) provides a similar description of e-money as “monetary value on a technical that may be widely used for making payments to entities other than the e-money issuer” [8].

– In Vietnam, the concept of “electronic money” was first introduced in the Decree 52/2024/ND-CP, dated May 15, 2024 issued by the Government regulating non-cash payments (“Decree 52”). The decree defines electronic money as “the value of Vietnamese currency on technical devices provided on a reciprocal basis corresponding to the amount prepaid by customers to banks, foreign bank branches, or payment intermediary service providers offering e-wallet services”. From this definition, it is clear that Vietnam acknowledges certain basic characteristics of e-money, such as: (i) being stored on technical devices, and (ii) being accepted by entities other than the issuer. Specifically, according to Article 3 of Decree 52, e-money is not considered to have the same value as cash, is not an alternative for cash, and are not recognized as a non-cash means of payment. Currently, Vietnam only recognizes non-cash payment instruments, including checks, payment orders, payment authorizations, collection receipts, collection authorizations, bank cards (including debit cards, credit cards, and prepaid cards), e-wallets, and other means of payment as regulated by the State Bank.

According to the State Bank of Vietnam [9], from the perspective of virtual assets and commodities, cryptocurrency or virtual currency can be considered a type of asset. However, they have not been specifically defined in the Civil Code, and there are no regulations governing virtual assets (including virtual currency as a type of virtual asset). From a monetary perspective, most countries do not accept virtual currency as legal tender or means of payment. This is due to concerns about national sovereignty over currency issuance, which could be infringed upon, affecting the efficiency of monetary policy management. Additionally, virtual currency, being outside the scope of Central Banks regulations, may facilitate tax evasion, illegal money transfers, and financing of illegal activities.

  1. Legal regulations on Cryptocurrency governance in Vietnam and selected countries worldwide

The existence and legality of cryptocurrency remain controversial worldwide, with jurisdictions adopting varying regulatory approaches. Broadly, countries can be classified into three categories: (i) those adopting a neutral stance, neither endorsing nor expressly prohibiting cryptocurrency transactions; (ii) those outright rejecting cryptocurrency by declaring its use and exchange unlawful; and (iii) those imposing an absolute prohibition, refusing to recognize cryptocurrency as legal tender to safeguard national monetary sovereignty [10]. Certain jurisdictions have recognized the existence of cryptocurrency and have enacted legislative and regulatory measures to oversee their uses. In this regard, the legal frameworks governing cryptocurrency, which have attracted significant regulatory scrutiny at both national and supranational levels, primarily address the following key aspects:

  • Regulations on subjects/organizations issuing cryptocurrency and issuance conditions;
  • Regulations on risk governance for issuing organizations;
  • Regulations on anti-money laundering and the prevention of illegal transactions;
  • Regulations on consumer protection.

One of the most complete and comprehensive acts currently regulating the legal framework for cryptocurrencies is Markets in Crypto-Assets (MiCA) Regulation, adopted by the European Parliament (EP) and the Council of the European Union (EUC) [11]. The key provisions of MiCA have been aggregated by the authors as follows:

(i) Regarding the subjects/organizations issuing cryptocurrency and issuance conditions. The first European Union (EU) Act on Cryptocurrency – MiCA has come into full effect since December 2024. Accordingly, issuers,  providers of crypto assets to third parties may be subject to certain obligations such as having a prospectus as prescribed when offering publicly; must having cryptocurrency issuance rights from the competent regulatory authorities; complying with the rules for marketing cryptocurrency to the public (Article 9. Publication of the crypto-asset white paper and the marketing communications, Article 12. Modification of published crypto-asset white papers and the marketing communications).

(ii) Regarding the risk governance for issuing organizations: The regulations stipulate that organizations issuing cryptocurrency are not allowed to mobilize or receive deposits. They must implement measures to ensure the performance of their obligations, such as using escrow accounts or bank guarantees. These regulations also aim to support policies that protect the rights of cryptocurrency investors.

(iii) Regarding the anti-money laundering and the prevention of illegal transactions: Under MiCA, activities related to crypto-assets will be monitored in the same manner as traditional money transfers to prevent suspicious transactions, combat market manipulation and address financial crimes. Detailed information regarding the origin of assets and beneficiaries will be retained within transactions and MiCA will regulate transactions exceeding €1,000 involving electronic wallets when transacting with other electronic wallets managed by crypto-asset service providers. Furthermore, MiCA imposes an obligation on crypto-asset service providers to detect and prevent illegal crypto-asset flows, and ensures that all crypto-asset companies comply with anti-money laundering obligations under MiCA and EU Directive 2015/849 on anti-money laundering (specifically the provisions of Chapter 1 Section 5 on the authorization of crypto-asset service providers).

(iv) Regarding the protection of consumer/investor rights: Regulations on the protection of investor rights are outlined in policies on the governance of cryptocurrency issuers and cryptocurrency supply chains. According to MiCA, the European Union implements policies to manage and supervise services such as custody, management or investment advice of crypto- assets, etc.. Cryptocurrency service providers may hold legal responsible for damages arising from cyber attacks or system glitches. Platforms are required to inform users about the risks associated with public offerings. The European Securities and Markets Authority (ESMA) has authority to intervene and ban or restrict cryptocurrency platforms if they fail to protect investor rights (specifically Article 4. Publish information to the public), Article 68. Governance arrangements).

Beside the EU, the US, as a global financial hub, also has a keen interest in cryptocurrency governance policies. The US is considered to still have a highly cautious approach toward this new financial instrument. In mid-2024, the U.S. House of Representatives passed a cryptocurrency bill titled the “Financial Innovation and Technology for the 21st Century Act (FIT21)” [12]. This bill not only provides protective mechanisms for the cryptocurrency industry, but also outlines the jurisdictional authority of “Securities and Exchange Commission (SEC)” and the “Commodity Futures Trading Commission (CFTC)”; however, this draft was not passed by the US Senate. Thus, the US continues to advocate for strict governance of cryptocurrency, as outlined by Executive Order No. 14067, signed by President Joe Biden on March 9, 2022, titled “Ensuring Responsible Development of Digital Assets”. This Order outlines 06 main tasks are set out, including protecting consumers, protecting national financial stability, and combating illegal financial activities.

Switzerland is known as one of the leading countries in cryptocurrency and digital assets, which has a legal framework for activities related to digital assets and cryptocurrency, including regulations on taxes and customers protection. Activities related to digital assets and cryptocurrency are managed by the Swiss National Bank (SNB) and the Swiss Financial Market Supervisory Authority (FINMA). FINMA has issued regulations and standards for digital assets, and also allows companies operating in this field to register and operate in Switzerland.

Singapore is also an attractive market and a preferred choice for many individual and institutional investors to access, establish, and conduct transactions related to cryptocurrencies and digital assets. This is due to the country’s open policies and legal framework for the access and regulation of activities related to digital assets. Activities involving digital assets and cryptocurrencies are supervised by the Monetary Authority of Singapore (MAS) and the Accounting and Corporate Regulatory Authority (ACRA).  In 2019, MAS introduced a new regulatory framework for activities related to digital assets, allowing companies operating in this sector to register and conduct business in Singapore [13]. Cryptocurrency is determined as a form of asset, with various policies in place to protect property rights. Additionally, the Singaporean government has incorporated virtual currencies into its anti-money laundering (AML) and counter-terrorism financing (CTF) regulations [14].

In Vietnam, Decree 52 is the first legislation to recognize the legality of e-money. Specifically, this Decree sets out a number of regulations related to e-money, including the definition of e-money (Article 3.12) and specific the forms of e-money used in payment activities, such as e-wallets and prepaid cards (Article 6). Entities authorized to provide e-money services include banks and foreign bank branches (offering e-wallet and prepaid card services), as well as organizations providing intermediary payment services (offering e-wallet services linked to customers’ payment accounts at banks).

However, the approach taken in Decree 52 indicates that Vietnamese legislators have only recently recognized e-money as a form of non-physical cash storage, corresponding to the amount of money prepaid by customers to banks, foreign bank branches, and service providers. Consequently, under this regulation, commonly known cryptocurrencies such as Bitcoin and Ethereum do not qualify as e-money and remain prohibited for use as a means of payment in Vietnam [15]. This approach aligns with that of certain countries, including Russia, China, and India – jurisdictions that reject digital cryptocurrencies – in an effort to prevent digital assets from functioning as money or a method of exchange. This, in turn, helps mitigate potential impacts on money supply and demand while maintaining active control over monetary policy.

It can be seen that the issuance of Decree 52 along with the overall concepts of e-money, has partly laid the groundwork for the recognition of digital products and financial technology in Vietnam. However, it still lacks an official and comprehensive legal framework for cryptocurrencies and digital assets. The absence of clear regulations defining the legal nature of cryptocurrencies, as well as detailed regulations governing the creation, trading, monitoring, and processing of transactions related to cryptocurrencies and digital assets has caused Vietnam to lag behind the global trend. At the same time, this lack of regulations has made it more difficult to manage, monitor, and ensure the safety of the financial market, banking, taxes, and anti-money laundering, etc. due to the inability to promptly manage, control, detect, and handle activities related to virtual currencies, and to overlook illegal acts involving their use.

Following the Government’s strong directive, Vietnam is making significant efforts to develop and refine the legal framework for digital assets and cryptocurrencies [16]. Notably, the draft of Law on the Digital Technology Industry, which is gone through discussions by the National Assembly, introduces several regulations related to digital assets. Clause 1, Article 8 of the Draft Law defines digital assets as “digital technology products created, issued, stored, transferred, and authenticated by blockchain technology, over which individuals have ownership rights in accordance with civil law and relevant regulations” [17]. According to this definition, digital assets encompass products that are created, stored, transferred, and authenticated using blockchain technology. Nonetheless, this definition does not provide a clear legal basis for determining whether cryptocurrency qualifies as a digital asset. Instead, the classification of asset types and ownership rights is subject to regulations under civil law and other relevant legal provisions. Additionally, the definition fails to address key characteristics of digital assets, such as their intangibility and decentralization. As a result, when compared to the provisions of the 2015 Civil Code, it remains unclear whether cryptocurrency is considered as class of property or digital assets, or whether digital assets fall under the categories of objects, money, securities, property rights, or other asset types. The inclusion of multiple, inconsistent definitions across different legal regulations, without a unified approach to the legal status of cryptocurrencies and digital assets, creates further ambiguity and lacks of practical application.

Thus, it can be seen that the draft of Law on Digital Technology Industry has implied the recognition of cryptocurrency, created by blockchain technology as a type of digital asset, but still leaves open the possibility for civil law and other specialized regulations to specify in detail the legal nature, creation, determination of ownership and rights related to cryptocurrency and digital assets. Meanwhile, the Civil Code and other documents have not addressed and clarified these issues. The lack of such detailed regulations  means that while cryptocurrency transactions still take place, they operate without a framework and tools to control, and without a mechanism to protect the rights and legitimate interests of investors, individuals and organizations participating in the market for trading cryptocurrency and digital assets. In 2023, Unidroit issued principles for defining digital assets, in which it defined digital assets as controllable electronic data, accordingly Unidroit issued principles for defining “electronic data”, “controllability” and the rights and obligations of entities involved in digital asset transactions [18]. This document could be served as a useful reference for Vietnam in its effort to build and refine the legal framework for digital assets and cryptocurrency.

Vietnam has yet to established a comprehensive legal framework for cryptocurrency, and investors are advised to exercise caution and due diligence:

Vietnam Investment reported on March 5, 2025: According to Chainalysis, in 2024, Vietnam ranked 5th globally in terms of interest in digital assets, 3rd worldwide in the use of international trading platforms, and 6th in transaction volume on decentralized platforms. Currently, 17 million Vietnamese citizens own digital assets, with the total market value exceeding USD 100 billion. The unregulated trading of digital assets has contributed to the formation of a massive underground economy.

According to survey conducted by the National Cybersecurity Association, in 2024, one in every 220 users was a victim of online fraud, representing a rate of 0.45%. The total financial losses due to online fraud in 2024 were estimated at VND 18.9 trillion. Regarding cryptocurrency-related fraud, Chainalysis (a U.S.-based blockchain analytics company) initially estimated that wallets linked to fraudulent activities generated USD 9.9 billion in 2024, with projections suggesting this figure could reach a record high of USD 12.4 billion in 2025. Most of these scams originate from large-scale fraud centers in Southeast Asia and are exhibiting increasingly decentralized operational patterns.  Mr. Dang Minh Tuan, Chairman of the Vietnam Blockchain Union (VBU), stated that investing in cryptocurrency carries significant risks, as cryptocurrency in Vietnam currently lack legal recognition and regulatory oversight to prevent fraud and market manipulation. Consequently, cryptocurrency transactions are not legally protected. Investors are advised to thoroughly understand the technology, acquire proficiency in using digital wallets, and familiarize themselves with key cryptocurrency-related concepts.

Massive investments in cryptocurrency and virtual currencies based on unverified information or crowd psychology can easily lead to significant risks for investors. While the law does not provide clear regulations on protecting investors in these transactions, incidents, problems, and disputes related to cryptocurrency and virtual currency transactions will be difficult to protect and resolve through legal means.

  1. Strategic recommendations for the development and enhancement of Vietnam’s cryptocurrency legal framework

Vietnam can leverage international experience to refine its legal framework and policies on cryptocurrency in particular and digital assets in general. Currently, countries that recognize digital assets manage them through several measures, including: (1) tax policies; (2) Anti-Money Laundering (AML) and Counter-Financing of Terrorism (CFT) standards; (3) consumer protection policies; and (4) licensing regulations for Digital Asset Service Providers [19]. The authors propose the following recommendations:

First, for the further development and refinement of detailed regulations on digital assets, cryptocurrency, and related transactions: It is essential to recognize them as a form of asset and to incorporate regulations on digital assets into the Civil Code and other relevant legal documents. Amid the rapid advancement of technology, the enumeration of digital assets cannot comprehensively cover all asset types, as digital currencies and assets will continue to emerge and evolve over time. Therefore, we advocate for defining digital assets based on their inherent characteristics, classifying them accordingly, and establishing ownership rights and transaction regulations for these assets, with reference to the 2023 Unidroit Principles. A clear determination of the legal nature of cryptocurrency and digital assets serves as the foundation for developing comprehensive policies and legal regulations on taxation for transactions involving these assets.

Second, regarding anti-money laundering and counter-terrorism financing: The Financial Action Task Force (FATF) has issued recommendations to combat money laundering and terrorist financing in the virtual asset sector. These recommendations include requiring countries to implement Know Your Customer (KYC) measures and transaction monitoring [20]. In many countries, regulations mandate that virtual asset exchanges conduct user identity verification and monitor transactions to prevent money laundering and terrorist financing. Therefore, Vietnam should establish anti-money laundering and counter-terrorism financing regulations for virtual asset service providers, develop a system for monitoring suspicious transactions, and collaborate with international organizations to prevent cross-border money laundering activities.

Third, regarding consumer protection: It is essential to establish regulations on security and safety measures, including: technical security requirements for equipment used in the issuance and storage of digital assets; regulations on the right to access payment history statements; dispute resolution procedures and competent authorities responsible for handling disputes; and enforcement measures. Additionally, penalties should be imposed for violations such as conducting money transfers and digital payment transactions for illegal activities

Finally, regarding the licensing and regulation of digital asset service providers: In the US, digital asset exchanges are required to register with regulatory authorities such as the US Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC), while also complying with anti-money laundering (AML) and Know Your Customer (KYC) requirements. Similarly, South Korea and the Philippines mandate that exchanges obtain operating licenses, report suspicious transactions, and ensure the security of customer assets. Therefore, it is necessary to develop and institutionalize regulatory measures governing the operations of service providers and issuers of digital assets and cryptocurrencies. This should include a strong emphasis on establishing corporate responsibilities regarding the protection of customers’ personal data and ensuring transparency in financial activities. Notably, a clear distinction must be made between customer assets and the entities’ assets.

 

LIST OF REFERENCES

  1. Business Forum Magazine (2025), Urgently build a legal framework for digital assets, https://diendandoanhnghiep.vn/gap-rut-xay-dung-khung-phap-ly-cho-tai-san-so-10150915.html., accessed: March 5, 2025.
  2. Bao moi (2025), What do you know about 10 powerful cryptocurrencies in the world?, https://baomoi.com/biet-gi-ve-10-dong-tien-dien-tu-quyen-luc-tren-the-gioi-c51574652.epi, accessed: March 5, 2025.
  3. Nguyen Thi Cat Tuong (2022), “Some legal proposals on digital currency”, Vietnam Journal of Industry, Competition and Trade, No. 14.
  4. FATF (2014), Virtual Currencies – Key Definitions and Potential AML/CFT Risks.
  5. Le Thi Kim Nhung, Nguyen Le Duc (2024), “Cryptocurrency Management in some countries – Experience and Some Policy Recommendations for Vietnam”, Baking Review, https://tapchinganhang.gov.vn/quan-li-tien-ma-hoa-o-mot-so-quoc-gia-kinh-nghiem-va-mot-so-khuyen-nghi-chinh-sach-doi-voi-viet-nam-11591.html, accessed: March 5, 2025.
  6. European Commission, https://finance.ec.europa.eu/consumer-finance-and-payments/payment-services/e-money_en#:~:text=Electronic%20money%20(e%2Dmoney),and%20secure%20e%2Dmoney%20services, accessed: March 5, 2025.
  7. World Bank, https://digitalfinance.worldbank.org/topics/financial-consumer-protection/e-money, accessed: March 4, 2025.
  8. European Central Bank, https://data.ecb.europa.eu/methodology/electronic-money#:~:text=Electronic%20money%20(e%2Dmoney),than%20the%20e%2Dmoney%20issue, accessed: March 5, 2025.
  9. National Institute for Economics and Finance (2017), Vietnam does not accept virtual currency as currency, https://mof.gov.vn/webcenter/portal/vclvcstc/pages_r/l/chi-tiet-tin?dDocName=MOFUCM110675, accessed: March 5, 2025.
  10. Pham Thi Thai Ha (2021), “Viewpoints of Bitcoin”, Review of Finance, 2nd edition June 2021, https://mof.gov.vn/webcenter/portal/vclvcstc/pages_r/l/chi-tiet-tin?dDocName=MOFUCM204677, accessed: March 5, 2025.
  11. European Securities and Markets Authority, https://www.esma.europa.eu/esmas-activities/digital-finance-and-innovation/markets-crypto-assets-regulation-mica, accessed: 05/3/2025.
  12. People’s Deputies Online (2024), US House of Representatives Passes Cryptocurrency Bill, Despite Mixed Opinions, https://daibieunhandan.vn/ha-vien-my-thong-qua-du-luat-ve-tien-dien-tu-bat-chap-nhung-y-kien-trai-chieu-post372642.html, accessed: March 5, 2025.
  13. Nguyen Doan Hung (2023), “Access to digital assets: A look at international experience”, Special edition of Banking Market Panorama 2023.
  14. Training Center for Elected Representatives, Overview of Singapore’s Cryptocurrency Laws, http://tailieu.quochoi.vn:8080/index.php/tai-lieu/chuyen-de-chuyen-sau/item/2948-t-ng-quan-phap-lu-t-v-ti-n-o-c-a-singapore, accessed: March 5, 2025.
  15. State Bank, Press release on Bitcoin and other similar cryptocurrencies, February 27, 2014.
  16. Directive No. 05/CT-TTg dated March 1, 2025, of the Prime Minister on key tasks and breakthrough solutions to promote economic growth and accelerate the disbursement of public investment capital, ensuring the national economic growth target for 2025 reaches 8% or higher.
  17. The draft of the Law on Digital Technology Industry was considered by the National Assembly at the 8th session agenda of the 15th National Assembly on November 23, 2024.
  18. Unidroit Principles on Digital Assets and Private Law (2023).
  19. Filling legal gaps, calculating tax collection options from digital assets, VnEconomy No. 35-2024 published on August 26, 2024, p.26-27.
  20. FATF, Guidance for a Risk-Based Approach to Virtual Assets and Virtual Asset Service Providers (VASPs), 2021.

Authors: LLM., Lawyer, Nguyen Thanh Ha, Lawyer Hoang Thi Phuong Lan, Nguyen Thi Huong

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