Cryptocurrencies are actively being considered an alternate form of financial instrument, and the blockchain technology powering it has already seen massive adoption all around the globe.
Vietnam is the latest country looking to study and formulate laws around digital currencies. The Vietnamese Finance Ministry has agreed to establish a research group who would be responsible for reviewing, analyzing and developing various regulatory policies around crypto-assets.
The research group was announced on 11th May by the ministry, which would comprise of 9 members. The members of the group would consist of:
- General Department of Taxation, the country’s securities regulator
- National Institute for Finance
- General Department of Vietnam Customs
- Department of Banking and Financial Institutions of the State Bank of Vietnam
The research group would be led by the vice-chairman of the State Securities Commission, Pham Hong Son. The regulatory body would be responsible for keeping track of new updates and regulatory challenges associated with the ever-evolving crypto sector and help Vietnam respond to regulatory challenges with more preparedness to tackle them.
Is Vietnam Doubling Back on Its Decision?
Vietnamese Prime Minister gave the nod for the formulation of the regulatory framework back in 2017 which made many believe that the crypto assets will be a legalized for use as a form of an exchange or a legal tender.
However, in April 2018, the government deemed bitcoin as illegal tender, meaning that even though people and businesses can invest in bitcoin, it cannot be used as a form of exchange to buy or sell goods.
Just days after deeming Bitcoin as illegal tender, the government issued an order restricting credit companies from offering any form of service to crypto providers in order to contain any form of money laundering woes.
The service ban was similar to Indian Central Bank prohibiting banks restricting commercial and government banks to offer any service to digital asset service providers. Since then, the government has not made any regulatory changes towards the digital asset service providers, which make the current formation of the research team even more significant.
Many believe the newly formed team could be a game-changer for the digital asset ecosystem.
Since the government has observed that those nations which have worked around crypto-assets and regulated it over time with changes as per the demand have fared better than those who have either outright banned it or refused to formulate laws around it.
Despite the regulatory uncertainty, local business has tried to establish crypto exchanges in the country. However, only peer-to-peer platforms have managed to gain traction from the community.