MPI has proposed a controlled pilot programme for fintech activities, including digital asset and cryptocurrency trades at financial centres. (Illustrative image - Photo: Shutterstock)

In a draft proposal for a National Assembly Resolution on building regional and international financial centres in Vietnam, the Ministry of Planning and Investment (MPI) has proposed a controlled testing policy (sandbox) for business models applying technology in the financial sector (fintech).

The Financial Centre Management and Operations Committee will be authorised to issue licences, oversee management, evaluate impacts and manage risks for sandbox trials in fintech activities, including platforms for trading digital and cryptocurrency assets.

The Government will provide detailed regulations on measures to prevent money laundering, as well as inspections and certifications regarding the security, cybersecurity and safety of digital asset service providers.

The management, issuance, ownership and trading of NFTs (a type of digital asset), utility tokens and cryptocurrency mining will also fall under Government authority. This aims to mitigate risks associated with energy security and environmental impact.

Purchases, payments, transfers and other transactions between organisations and individuals in the international financial centres are allowed to be conducted in the Vietnamese dong or freely convertible foreign currencies.

Under the Government’s plan, financial centres in Ho Chi Minh City and Da Nang are set to be established and operational by 2025. The construction of these centres aims to position Vietnam as a significant financial hub in the region and globally.

Data from CoinGecko indicates that the global cryptocurrency market value peaked at nearly 3.3 trillion USD on November 14, 2024.

Vietnam ranks among the top countries globally in cryptocurrency ownership, according to the latest Global Cryptocurrency Adoption Index report by Chainalysis.

However, Vietnam currently lacks a clear definition of virtual currencies and digital assets. Existing regulations only address the concept of electronic money tied to fiat currencies, such as prepaid bank cards and e-wallets.

Cryptocurrencies are not banned in Vietnam, but are not yet recognised as assets. The lack of a legal framework for these assets has led many businesses to register in Singapore or the US before operating in Vietnam, which reduces the country’s competitive advantage and results in tax revenue losses.

From a user perspective, the lack of transparency in this area increases transaction risks.