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Vietnam Inaugurates Research Unit Towards Possible Crypto Adoption

With Cryptocurrencies gaining prominence, several countries have begun to look into policies to incorporate them into their financial structures. Vietnam is joining that list, as the country’s Ministry of Finance is working actively to launch a research group to study cryptocurrencies and virtual assets. 

A Possible Policy for Cryptocurrency Use

Local news source Vietnam Plus broke the news on Monday, explaining in a report that the research group will lead the Vietnamese government’s policy formation efforts on adopt digital assets. The new unit will propose policies for the Vietnamese government and pave the way for possible crypto and blockchain adoption in the country going forward.

The group, which the government inaugurated on the same day, will include nine members. Pham Hong Son., the Vice Chairman of the State Securities Commission, will serve as its chair. Other members of the group include representatives of Vietnamese exchange and securities regulators – the National Institute for Vietnam Finance (NIVF), the General Department of Taxation, Vietnam Customs, and the State Bank of Vietnam.

Per the report, the research unit will help the nation to stay attuned with new developments in the fast-growing blockchain sector. Ultimately, this will give Vietnamese crypto investors and companies a chance to react adequately to regulatory challenges in their local crypto space.

Vietnam’s Complicated Relationship with Cryptocurrency

Vietnam has had mixed reactions to blockchain technology. In 2017, the country’s Prime Minister announced the government’s decision to supervise the creation of a legislative framework that will govern cryptocurrency use in Vietnam. However, the government banned Bitcoin as a mode of payment in April 2018. This directive meant that while individuals and corporations could still hold and trade in crypto, they couldn’t use virtual assets to purchase commodities. 

In the same month, the government issued a rule for financial institutions to restrict their virtual currency offerings to mitigate money laundering risks. Since then, Vietnam has not formally taken a stand or created a regulation to oversee the crypto industry.

Private Firms Lead Vietnam’s Adoption of Blockchain

Despite the non-existent government framework, there have been attempts to target the retail Vietnamese crypto market. A notable campaign was carried out by the Linh Thanh Group, Vietnam’s biggest distribution company. In March 2019, the company partnered with Swiss blockchain company KRONN Ventures to mine digital currencies and launch a crypto exchange in Vietnam. 

Earlier in the month, HDBank, a Vietnamese banking institution, joined Contour, a blockchain-based trade platform built on R3’s Corda. An announcement by the growing blockchain network confirmed that the bank would take advantage of digital trading technology to optimize the speed and security of its credit services.

HDBank is not the only Vietnamese finance institution that has partnered with a blockchain network. On May 3, Tien Phong Commercial Joint Stock Bank (TPBank) announced its partnership with Ripple, a blockchain technology company. 

According to the statement, the bank signed an agreement with the digital finance company to aid financial transactions between its customers in Japan and Vietnam. The bank also attributed its decision to the growing trend of immigration of Vietnam citizens to Japan.

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      Jimmy has been following the development of blockchain for several years, and he is optimistic about its potential to democratize the financial system.