Having invested in and traded cryptocurrencies on global exchanges for nearly ten years, Th. (HCMC) was once able to buy a house and a car thanks to the profits he earned.

A billion dollar gamble for many Vietnamese

The time of the COVID-19 pandemic in Vietnam was also a prosperous time for Th. as well as many other "investors".

"I just went to cryptocurrency exchanges, created an account, used Vietnamese Dong to buy intermediate coins, then switched to buying the cryptocurrencies I wanted to invest in. I bought at low prices, sold at high prices. The profit after buying and selling at that time was up to several billion VND," Th. proudly recounted.

However, just a short time later, the investment was no longer as lucky as before, causing Th. to continuously suffer losses. With increasing debt while investment results continued to fail, Th. turned to inviting acquaintances and colleagues to invest in business... and disappeared with the money.

Th. is just one of tens of millions of Vietnamese people who are investing and trading on cryptocurrency exchanges. At a recent workshop on building a legal framework for digital currencies organized by the Ho Chi Minh City Law Newspaper, journalist Dinh Duc Tho - deputy editor-in-chief of the Ho Chi Minh City Law Newspaper - said that Vietnam estimates that more than 20 million people have owned digital assets and digital currencies.

"Statistics show that in 2024, for digital assets, Vietnam will receive more than 105 billion USD - down from 120 billion USD in 2023, but still about 4 times the total FDI investment capital and equivalent to 1/4 of the country's total GDP," said Mr. Tho.

Recently, the virtual currency Pi has attracted great attention from Vietnamese netizens when it was listed on a number of exchanges. The price of Pi has been pushed up to nearly 3 USD at times, making many owners dream of becoming millionaires from scratch.

Previously, many Pi users organized groups to share transactions paid for with Pi, known as consensus transactions. Pi became the payment currency accepted by group members, despite Vietnamese law not allowing it.

But there are also many scams disguised as models inviting investment in virtual currency and virtual assets that are constantly happening in Vietnam. The number of victims is increasing because of the desire to get rich quickly. Many people have been scammed out of tens of billions of dong.

The most typical case is the 5,200 billion VND fraud case of Pho Duc Nam (nicknamed Mr Pips). Nam and his accomplices hid behind financial companies to mobilize people's money into foreign exchange and virtual currency exchanges, then appropriated...

Many benefits, challenges can be resolved?

According to the Ministry of Finance 's submission to the Government Office, if Vietnam bans crypto assets as well as organizations providing related services (issuance, trading floors, trading...), the benefits could be to help limit investment activities in highly volatile products, limit cash flows abroad, and avoid the risk of being blacklisted by the Financial Action Task Force (FATF) globally related to money laundering and terrorist financing.

However, the ban also hinders research, application, and development of new technologies, fails to promptly support innovative startups, and slows down the digital transformation process. At the same time, businesses lose a new channel for capital mobilization and investment, and the State loses a potential source of budget revenue.

Not to mention players and investors who still circumvent the ban by bypassing firewalls or switching to decentralized platforms. This will increase the risk for investors...

Meanwhile, allowing and managing crypto assets can bring many benefits to Vietnam such as attracting foreign investment; promoting research and development of new technologies in Vietnam; creating additional revenue for the state budget through tax collection, fees, and charges for activities related to crypto assets...

Of course, legalizing activities related to crypto assets also poses many challenges. For example, many crypto assets do not have clear intrinsic value, information is incomplete, leading to manipulation; can affect the traditional financial system; increase the level of competition for bank deposits and securities; risk of "crypto" (the conversion of traditional currencies to cryptocurrencies); difficulty in monitoring anonymous transaction data...

However, in the view of the Ministry of Finance, the above challenges can be largely resolved through the promulgation of new legal regulations and close coordination between ministries and branches.

Hope to have a legal corridor for cryptocurrency soon

Speaking with Tuoi Tre, many experts in the field agreed that Vietnam should quickly have a clear legal corridor for issues related to cryptocurrencies and crypto assets.

According to Mr. Tran Xuan Tien, general secretary of the Ho Chi Minh City Blockchain Association, many cryptocurrency scams have appeared in Vietnam over the years.

Despite the lack of a legal framework, the blockchain market has infiltrated Vietnam in one way or another. Completing the legal framework will help the country exploit and manage this established market.

Meanwhile, Ms. Lynn Hoang, Binance country manager in Vietnam, said that in the field of innovation, a clear legal environment will help increase market confidence and attract blockchain companies and global investors.

One example of the UAE's success in attracting large international capital from innovative companies is its clear regulation of digital assets.