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Vietnamese PM asks SBV to study cryptocurrency

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Gold plated souvenir Bitcoin coins are arranged for a photograph in London. AFP

Vietnamese PM asks SBV to study cryptocurrency

Vietnamese Prime Minister Pham Minh Chinh has asked the State Bank of Vietnam (SBV) to study and carry out pilot implementation for cryptocurrency based on blockchain technology in the 2021-2023 period.

This was highlighted in Prime Minister’s Decision No 942/QD-TTg about the e-Government development strategy towards a digital government.

Cryptocurrency based on blockchain is among core technologies Vietnam hopes to develop and master, as well as artificial intelligence (AI), big data, augmented reality and virtual reality (AR/VR), which were expected to create significant breakthroughs as well as favourable conditions for building a digital government.

There were no specific definitions for cryptocurrency and virtual assets in Vietnam. For many years, the SBV had stressed that cryptocurrencies, including Bitcoin, were not legally recognised in Vietnam and the use of cryptocurrencies as a means of payment was also not legally recognised and protected in the country.

The central bank asked credit institutions not to use cryptocurrencies as a type of currency or a means of payment.

To date, the central bank has not granted licences for any cryptocurrency trading platforms.

The Ministry of Finance set up a group to study virtual assets and cryptocurrencies under Decision No 664/QD-BTC dated April 24, 2020 to propose policies and management mechanisms.

According to Huynh Phuoc Nghia, deputy director of the Institute of Innovation under the University of Economics Ho Chi Minh City, it’s time for the government to study and carry out pilot implementation for cryptocurrency. “Digital money is an inevitable trend.”

Currently, traditional currencies, including the US dollar, euro and yen, had greater influence on the world currency basket and international trade. However, in the race to develop and apply new technologies, there was chance for countries like Vietnam to rise and have a new influence on the global financial system.

The pilot implementation would help the government find positive and negative aspects, if any, while developing a more appropriate management mechanism, Nghia said, adding that while cashless payments were increasing in Vietnam, the recognition of digital currencies by the central bank would help accelerate this process.

The study of cryptocurrency needed to be accelerated to gain advantages in the race, Le Dat Chi, deputy head of the university’s Finance Faculty, said. He cited a survey which found that central banks around the world were having three different responses to cryptocurrency. The first group, which included 65-68 central banks, were piloting cryptocurrency use; the second was starting to develop a plan for pilot implementation; and the third group were still observing. Vietnam was moving from the third group to the second group.

However, there were risks to financial and monetary security, Chi said.

NextTech Group chairman Nguyen Hoa Binh said it was necessary to have an official definition for cryptocurrency.

There were different words which might cause confusion, including virtual currency, digital currency, cryptocurrrency, electronic money and digital money.

VIET NAM NEWS/ASIA NEWS NETWORK

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