Vietnam's burgeoning digital currency market is urging stakeholders to push for clearer regulations as uncertainty looms over its future. According to PGS.TS Dinh Trong Thinh, these digital currencies are more accurately described as virtual assets rather than money, primarily serving as tools for accumulation and investment.
Despite the lack of specific legal recognition and regulation, investments related to cryptocurrencies are thriving, raising significant volumes of capital from Vietnamese investors. Thinh estimates the volume of transactions potentially amounts to billions of USD, all happening outside the purview of state oversight. “If we do not manage it, it will continue, so it is best to have clear mechanisms for management,” said Thinh, emphasizing the necessity of regulation for fostering market growth and accountability.
Lawyer Tran Tuan Anh of Minh Bạch Law Firm echoed similar sentiments, pointing out the risks associated with the current status quo. The increasing popularity of digital currency trading has also led to widespread fraud, with cases involving hundreds of billions of VND already reported. “We used to avoid regulating new factors inadequately defined. But it isn’t suitable for today’s world,” he argued, citing the importance of adapting to trends prominent in major economies.
The introduction of a structured legal framework around cryptocurrencies could mean enhanced transparency and security for investors. Tuan Anh discussed how formal regulations would delineate legal boundaries, thereby protecting individuals from fraud and creating greater market stability. “The construction of regulations will create the foundation for forming a healthy and transparent digital currency market,” he asserted.
The absence of regulation has not only constrained investor protection but has also led to significant tax evasion. Currently, transactions occur largely underground, which means the government misses out on tax revenues it could generate from this rapidly growing sector. According to Tuan Anh, without acknowledgment and regulation, the nation cannot effectively tax such lucrative transactions, resulting inevitably in lost revenues. “This leads to tax losses, which are almost unavoidable,” he warned.
Thinh elaborated on potential positive outcomes from regulation: “Recognizing virtual currencies would open the doors to proper exchange platforms managed by the state, allowing foreign investors to engage with the Vietnamese market.” Such engagement could channel international capital to Vietnam’s economy, enhancing its global financial integration.
Both experts stress the urgency of establishing these regulations not only to protect local investors but also to streamline Vietnam's approach to global economic integration. The glaring absence of legal guidelines leaves players exposed to high-risk scenarios with inadequate safeguards. “If we have specific legal provisions for virtual currency business, investors will be protected by law,” Thinh remarked.
Given the rapid evolution of digital currencies and their rising influence, the pressure is mounting on policymakers to respond decisively. Tuan Anh believes it is not just about introducing new laws, but about managing the transformative potential of the digital economy effectively. “With the investment environment becoming increasingly colorful, creating proper frameworks is key,” he concluded.
While hurdles remain, the mantra is clear: regulation of Vietnam’s digital currency sector is not merely recommended; it is imperative for economic growth, investor security, and fiscal responsibility.