Vietnam’s new digital industry law recognizes cryptocurrencies as legal assets

Vietnam, it seems, has decided to jump headfirst into the digital future, or at least that’s the narrative accompanying its newly passed Law on Digital Technology Industry. The headlines scream “Vietnam legalizes crypto,” and one can almost hear the champagne corks popping in certain corners of the internet, the ones that perpetually buzz with the promise of decentralized utopia and overnight riches. The law, approved by the National Assembly on the  14th of June and slated to take effect on the 1st of January, 2026, does indeed bring digital assets under a regulatory umbrella, which is a step, certainly. But as with all such grand pronouncements, the real story, the one that actually matters for the Vietnamese economy and its people, lies buried beneath the celebratory press releases and the aspirational rhetoric.

Let’s be clear about what this “legalization” entails. The legislation, as reported, makes a distinction – a crucial one, perhaps, or perhaps just a definitional fig leaf – between “virtual assets” and “crypto assets.” Both, we are told, rely on the magic of encryption or digital technologies for their validation and transfer. However, and this is important, neither category includes securities, digital fiat currencies (so, no official digital dong just yet, it seems), or other traditional financial instruments. This is not, therefore, a blanket endorsement of every wildcat “coin” or speculative token that emerges from the digital ether. The government, bless its ambitious heart, is now “tasked with outlining specific business conditions, classifications, and oversight mechanisms for these asset types.” In other words, the real work, the nitty-gritty of regulation that separates a functioning market from a digital casino, is yet to come. This is where the proverbial devil will reside, and frankly, given the history of the broader cryptocurrency space, that devil has a lot of details to play with.

One can’t help but notice the timing and the stated intent to align with international norms on cybersecurity and Anti-Money Laundering. Vietnam, you see, has been residing on the Financial Action Task Force’s (FATF) “gray list” since 2023. Being on the gray list isn’t exactly a badge of honor; it signals that a country needs to up its game in combating money laundering and terrorist financing. So, is this crypto legalization partly a sophisticated compliance play, an attempt to demonstrate to the FATF that Vietnam is serious about monitoring and controlling new financial technologies that have, shall we say, a colorful history when it comes to illicit fund flows? It’s a plausible interpretation. Bringing “crypto assets” into a formal regulatory framework, even a nascent one, at least provides a hook for imposing those much-needed AML safeguards. It’s a far cry from stamping out financial crime, but it’s a move in a direction international bodies might appreciate.

But the law, we’re assured, is about much more than just taming the wild west of cryptocurrency. It’s a cornerstone of Vietnam’s ambition to become a “digital tech hub.” This is where the vision broadens, encompassing incentives for enterprises dabbling in the altogether more tangible and potentially transformative fields of Artificial Intelligence, semiconductors, and digital infrastructure. We’re talking tax breaks, land-use benefits, and R&D support. The focus here is particularly on firms building core technologies like chip design and AI data centers. This part, at least on the surface, sounds like a more conventional, and arguably more sensible, industrial policy. Developing nations from over the world  are looking to climb the value chain and fostering a domestic tech industry, especially in strategic sectors like semiconductors, is a well-trodden path, albeit a very challenging one.

The plan also includes directives for regional governments to support workforce development through subsidies and training programs, and an integration of digital tech skills into national curricula. These are laudable goals. No country can become a tech hub without a skilled workforce. The question, as always, is one of execution and scale. Can these programs genuinely produce the engineers, data scientists, and technicians needed to power this ambition, and can they do it quickly enough to compete in the fiercely contested global tech landscape?

The Vietnamese government, with a touch of national pride, declared: “With this move, Vietnam has become the first country in the world to enact a standalone law specifically dedicated to the digital technology industry.” Now, one might quibble with the semantics of “standalone” and “specifically dedicated.” Many nations have comprehensive digital strategies and suites of laws addressing various aspects of the tech industry. But let’s not get bogged down in claims of “firsts.” The substantive issue is whether this law will actually achieve its stated aims.

And this brings us back, inevitably, to the more problematic child in this legislative family: cryptocurrency. Juxtaposed with these grand ambitions for AI and semiconductors are some rather sobering reminders of the current crypto reality on the ground in Vietnam. In February 2025, in a mere blink of an eye in legislative terms, Vietnamese police busted a fake crypto mining platform called BitMiner. Posing as a Dubai-based operation, this scam managed to relieve over 200 victims of more than 4 billion Vietnamese dong, which translates to roughly $157,300. They were selling bogus mining packages and, insultingly, “education materials.” It seems the only education provided was a harsh lesson in due diligence.

If that weren’t enough, cast your mind back to December 2024. The Hanoi City Police Department stepped in to prevent 300 potential victims from investing in an elaborate crypto scam that had already defrauded about 100 businesses and 400 individuals to the tune of 30 billion Vietnamese dong, or a hefty $1.17 million. This particular enterprise, charmingly named “Million Smiles” (the irony is almost painful), was promoting its own in-house cryptocurrency, something called “QFS,” or Quantum Financial System. The marketing, as is so often the case in these schemes, was a masterclass in deception, linking this magical new coin to “ancestral treasures” and “spiritual claims.” One can only imagine the pitch meetings.

These incidents aren’t minor footnotes; they are glaring red flags. They underscore the immense challenge of regulating a sector rife with opportunism and outright fraud, especially when dealing with assets whose value is often driven by hype and speculation rather than any discernible underlying economic utility. While the new law promises oversight, the existence of sophisticated scams that can defraud hundreds of people and businesses of significant sums suggests that the regulators will have their work cut out for them. The question is whether the forthcoming “specific business conditions” for crypto assets will be robust enough to protect ordinary Vietnamese citizens from becoming fodder for the next BitMiner or Million Smiles, or whether they will inadvertently lend a veneer of legitimacy to operations that are, at their core, designed to separate fools from their money.

What does it mean to “legalize” crypto assets in this context? If it means providing a clear framework for legitimate cryptocurrency exchanges to operate with strong consumer protection, capital requirements and transparency, then it could be a positive step. If, however, it simply means that any new “coin” can be launched with minimal scrutiny, or that the primary focus is on AML to satisfy international bodies without robust investor safeguards, then it risks becoming a license for more sophisticated scams. The allure of quick profits from trading bitcoin or the latest alt-coin can be powerful, especially in a developing economy. But genuine economic development comes from building real industries, creating sustainable jobs, and fostering innovation that solves actual problems – things like semiconductor design and AI applications, which the law also aims to support.

The danger is that the speculative froth of the cryptocurrency world could distract from, or even detract from, these more substantive goals. Resources, both human and capital, could be diverted towards chasing crypto riches instead of building the foundations of a genuine tech hub. The promise of tax breaks for AI and semiconductor firms is sensible, but if the regulatory environment for crypto is too lax, the most visible “innovation” might end up being new ways to package and sell speculative digital tokens.

So, Vietnam stands at a crossroads. It has laid out an ambitious digital blueprint. The parts concerning AI, semiconductors, and digital infrastructure development seem, at least in principle, to be pointed in a productive direction. The decision to formally regulate “crypto assets” is, in itself, neither inherently good nor bad; it is what comes next that will determine its impact. Will the detailed regulations foster genuine innovation in financial technology while rigorously protecting consumers and clamping down on the pervasive fraud that has characterized so much of the cryptocurrency world? Or will it inadvertently create a more fertile ground for speculative bubbles and sophisticated scams, all under the umbrella of state sanction?

The ghost of Million Smiles and the victims of BitMiner should serve as a constant reminder to Vietnamese policymakers: the digital frontier is exciting, but it’s also fraught with peril. Building a true digital tech hub requires more than just enabling the trade of every new cryptocurrency; it requires fostering genuine technological advancement, protecting citizens, and ensuring that the pursuit of digital modernity doesn’t simply enrich a few at the expense of many. The world will be watching to see which path Vietnam chooses, not just in its laws, but in their enforcement.