Vietnam’s Cryptocurrency Regulation: Evolving from a Gray Area to Controlled Testing
This analysis by Tiger Research explores Vietnam’s shift in cryptocurrency regulation from a gray zone to controlled experimentation, highlighting the implications for businesses as the country aims to implement a crypto sandbox by mid-2026.
Vietnam is making a concerted effort to transition from an observational stance on cryptocurrency policy. By mid-2026, the government intends to establish a cryptocurrency sandbox while concurrently developing a structured regulatory framework.
Businesses that engage proactively prior to the finalization of regulatory frameworks stand to gain competitive advantages in Vietnam’s emerging institutionalized cryptocurrency market.
Market analyses reveal that compliance with regulations, transparency in operations, and agility in response will become more critical than technological advancements in securing success in Vietnam’s cryptocurrency sector.
Vietnam has positioned itself as one of the most vibrant cryptocurrency markets globally, consistently ranking among the top five in Chainalysis’ Global Crypto Adoption Index since 2021. More than 21% of the adult population has engaged with cryptocurrencies, with annual inflows into the Vietnamese market exceeding $100 billion.
Young populations predominantly represent the Vietnamese cryptocurrency market, participating via global exchanges for trading, using self-custody wallets for P2P transactions, and engaging with DeFi protocols and GameFi platforms.
Despite the significant enthusiasm surrounding the market, Vietnam’s regulatory environment remains starkly different. Cryptocurrencies are not recognized as legal tender by the government, with the State Bank of Vietnam (SBV) explicitly prohibiting their use for payments. While individual ownership and trading are allowed, the vagueness creates an ambiguous market landscape.
Regulatory frameworks for cryptocurrency businesses in Vietnam are non-existent. The lack of licensing for exchanges, custody services, and stablecoin operations poses hurdles for industry growth.
This regulatory void has resulted in Vietnam being placed on the Financial Action Task Force’s (FATF) grey list, which damages economic credibility and has adverse outcomes. Cryptocurrency firms are relocating to jurisdictions with clearer regulations, such as Singapore, raising concerns about the outflow of talent and investment, ultimately jeopardizing national competitiveness.
This report delves into the regulatory landscape of Vietnam’s cryptocurrency sector, analyzing the various positions held by regulatory bodies while exploring recent government initiatives that may reshape the market.
An understanding of the differing positions among regulatory agencies—determined by their individual priorities—is vital for grasping the broader context of Vietnam’s cryptocurrency landscape.
The SBV adopts a highly cautious approach compared to other regulatory bodies in Vietnam. In 2017, it issued Official Letter 5747/NHNN-PC, which prohibits cryptocurrency as a payment method, viewing it as a potential risk to the stability of the national financial system.
However, the SBV acknowledges the potential applications of blockchain technology. It has initiated a Central Bank Digital Currency (CBDC) pilot program from 2021 to 2025, focusing more on limited use within a government-controlled framework rather than fully opening the cryptocurrency market. This cautious stance perpetuates regulatory uncertainty by limiting various potential applications of cryptocurrency.
The Ministry of Finance (MoF) takes a more enthusiastic approach toward the cryptocurrency sector, revealing plans to launch a cryptocurrency sandbox in collaboration with international exchanges such as Bybit. This initiative is widely seen as an essential initial step towards creating a formal regulatory environment for cryptocurrencies in Vietnam.
The MoF has had a dedicated working group focused on cryptocurrency since 2021, working on improving tax reporting mechanisms, ensuring fund source transparency, and establishing standards for cryptocurrency-associated investment products. Its core goal is to manage financial flows effectively while minimizing the risk of tax evasion and enabling cryptocurrency innovation. The MoF actively supports the creation of official licensing structures for exchanges, custody services, and stablecoin issuers.
This proactive stance aims to nurture a healthy cryptocurrency market by offering compliant firms the chance to flourish while enforcing strict adherence to financial disclosure and anti-money laundering (AML) regulations.
The Securities and Exchange Commission (SSC) supervises Vietnam’s capital markets and remains particularly cautious about tokenized assets. Its main concern centers around determining whether digital assets meant for investment purposes should be categorized as securities and thus require regulatory oversight.
The SSC expresses apprehension over the potential for “hidden securities issuance” by cryptocurrency projects raising capital through ICOs, STOs, and DeFi products, as these may skirt essential disclosure requirements and investor protections demanded by traditional securities markets. This careful approach prolongs the integration of security and investment tokens into Vietnam’s established financial systems. Consequently, projects exploring tokenization face considerable uncertainty.
The Ministry of Justice (MoJ) plays an advisory role, emphasizing legal consistency for digital assets. The MoJ proposes a clear definition of digital assets as a new asset category in Vietnam’s civil and commercial laws, which will establish essential foundations for ownership disputes and legal agreements regarding tokenized assets.
The MoJ promotes discussions for amending civil code regulations with various stakeholders. However, challenges such as compatibility with existing legal frameworks and complex interdepartmental coordination slow down progress. As a result, cryptocurrency businesses and investors face significant legal uncertainties in matters of digital asset custody, theft, and liquidation in the absence of clear ownership rules. Some criminal court decisions have recognized cryptocurrencies as assets possessing value, providing legal protection in specific instances.
The Ministry of Public Security (MoPS) takes a stringent stance on the uses of cryptocurrency that could facilitate financial crimes. The MoPS predominantly focuses on tackling issues such as cryptocurrency-related fraud, illicit fundraising, money laundering, and tax evasion, proposing stricter Know Your Customer (KYC) requirements for cryptocurrency platforms and mandatory reporting mechanisms for suspicious transactions.
Vietnam’s regulatory evolution in cryptocurrency showcases a cautious yet fragmented approach. Despite a surge in retail adoption, the government has been slow to formalize a legal framework.
The SBV’s Official Letter 5747/NHNN-PC effectively prohibits the use of cryptocurrencies as legitimate payment methods. Meanwhile, ownership and P2P transactions are unregulated, creating a legal gray zone that has spurred widespread crypto adoption without legal protections for investors.
During this period, Vietnam witnessed an explosion in cryptocurrency activities. Individual traders used global platforms like Binance and DeFi solutions to navigate existing regulations, leading to a rapid increase in fraud cases. Moreover, many businesses have opted to move abroad, with firms like Sky Mavis and Kyber Network relocating to Singapore, which has deprived Vietnam of talent and investment potential.
The Vietnam Blockchain Association (VBA) has been established to advocate for the advancement of blockchain technology and the development of a legal framework in Vietnam. The association seeks to gather industry insights for government discussions and to drive the growth of Vietnam’s digital economy through blockchain education and awareness initiatives.
The Financial Action Task Force (FATF) placed Vietnam on its grey list due to insufficient anti-money laundering (AML) regulations affecting cryptocurrency assets, which has prompted the government to reinforce regulations surrounding cryptocurrency exchanges, stablecoin issuers, and P2P transactions.
In October 2024, Vietnam introduced the National Blockchain Strategy 2024-2030 (Decision No. 1236/QĐ-TTg), aimed at promoting blockchain across various sectors while underscoring regulated experimentation through digital asset sandbox pilot programs. This document serves as the government’s definitive acknowledgment of blockchain’s fundamental role in the nation’s digital economic aspirations.
The Prime Minister of Vietnam has tasked the Ministry of Finance and the SBV with creating a comprehensive regulatory framework for digital assets under Directive 05/CT-TTg. The Ministry of Finance is collaborating with Bybit and other international exchanges to craft a cryptocurrency sandbox initiative and is in the processes of drafting relevant legislation for digital assets. Potential delays in formal law adoption might arise due to interdepartmental coordination issues. Following the launch of the sandbox in mid-2026, Vietnam will transition from regulatory ambiguity to a phase of controlled market experimentation.
Vietnam is progressively moving from passive observation to active regulation of its cryptocurrency sector. In early 2025, the government initiated a pilot program for cryptocurrency exchanges directed by the Prime Minister, with the MoF at the helm, in partnership with global exchanges like Bybit. This sandbox represents an initial effort to legitimize cryptocurrency trading within a controlled scope, evaluating compliance frameworks, AML/KYC standards, and stablecoin use.
The precise operational framework and terms of collaboration remain partially undisclosed. Bybit and other global entities are actively providing technical insights and policy recommendations, eager to engage but awaiting clearer regulatory frameworks detailing sandbox operations, licensing conditions, and government priorities regarding technology. The pace of progress will depend on Vietnam’s internal decision-making and sequencing for legal implementation.
Vietnam’s National Blockchain Strategy (2024-2030) positions blockchain at the heart of digital transformation. It aims for the legal recognition of blockchain applications and promotes expanded use across various sectors. The initiative seeks to encourage “Made in Vietnam” blockchain technologies and reduce regulatory hurdles for testing blockchain innovations, allowing for real-time adjustments from both the government and private sectors.
These initial developments indicate a significant shift in perception towards blockchain. Vietnam is transitioning from viewing blockchain as speculative assets to recognizing it as essential digital infrastructure. Early movers can align with national priorities and play a role in shaping policy, effectively building foundational infrastructure before formal regulatory measures take shape. This scenario presents a strategic opportunity for businesses to engage meaningfully in the sector.
As Vietnam stands on the cusp of significant shifts in its digital asset framework, it is transitioning from regulatory uncertainty towards methodical experimental governance. Influenced by internal policy adjustments and pressure to comply with FATF guidelines, the unfolding of the cryptocurrency sandbox, the announcement of a blockchain strategy, and the drafting of digital asset regulations showcase proactive governmental involvement.
The government aims to balance blockchain innovation with financial stability through robust regulatory compliance. In the short term, centralized AML/KYC compliance models are expected to dominate, while challenges for DeFi and privacy-enhancing technologies persist.
The lead-up to the mid-2026 sandbox launch represents a crucial opportunity for preparation. Companies can interact with policymakers, refine their business models, and foster trust relationships. Those taking the initiative will position themselves advantageously as Vietnam formalizes its cryptocurrency sector.
Success will hinge on regulatory insight, operational transparency, and adaptability rather than purely technological advancements. Organizations that align with evolving regulations are poised to capitalize on the burgeoning digital economy in Southeast Asia.
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