return icon Vietnamnet.vn

Bitcoin and cryptocurrency: virtual money or digital currency?

There are different definitions and interpretations of bitcoin and cryptocurrencies in Vietnam, even among experts and policymakers.

Speaking to the National Assembly on June 8, Governor of the State Bank of Vietnam Nguyen Thi Hong said that electronic money and virtual money are issues of great public interest. These concepts need to be clarified.

According to the governor, electronic money is an expression of legal currency, or currency issued by the central bank. When a person has paper money and coins but does not hold it and stores it in electronic form in mobile devices, computer networks, that is electronic money.

"Electronic currencies have a 1:1 ratio with legal currency," said the Governor of the State Bank.

The State Bank has issued circulars and regulations on e-wallets. These are actually cryptocurrency regulations. The State Bank is drafting Decree 101 on Non-Cash Payments and will clarify this concept further.

“In fact, there is the concept of virtual money and virtual assets that we often talk about, like Bitcoin. This is not a fiat currency issued by central banks, but created by organizations in the private sector on the basis of computer network algorithms,” said Ms. Hong.

She said that virtual currencies such as Bitcoin are only recognized in certain communities, such as the gaming community or the technology floor.

Each country in the world has a different way of managing this issue. Some countries consider virtual currencies and virtual assets as assets that are taxed and licensed for trading.

In Vietnam, the Government has assigned the State Bank of Vietnam and relevant agencies to study and develop the legal corridor for virtual currencies.

Should Bitcoin be called “digital money” or “virtual money”?

Dr. David (Duc) Tran, Associate Professor of Computer Science and Director of the Research Laboratory for Network Computing of the University of Massachusetts (USA), who is also a Research Professor at Vin University and a collaborator on Blockchain at the Institute for Advanced Study in Mathematics (Vietnam), said that Blockchain is usually called virtual money but this is not fully accurate.

According to him, the definition of electronic money, virtual currency and digital currency given by the Governor of the State Bank of Vietnam at the recent National Assembly session is not suitable. He said that the aforementioned currencies are all electronic currencies.

“Bitcoin or Central Bank Digital Currency (CBDC) is also an electronic currency, but it is a digital electronic currency, so both are digital currencies. Therefore, the definition of the State Bank of Vietnam calling CBDC a digital currency, while Bitcoin is a virtual currency is not correct,” he said.

He said Bitcoin is the first and most popular digital currency application in the world. Later, when the central banks saw the good aspects of digital currency and the danger of the popularity of Bitcoin affecting their national finances, then CBDC was noticed. Therefore, this expert believes that the definition given by the State Bank of Vietnam is not good in either logic or technique.

He said that all types of money such as virtual money, electronic money and digital money are electronic money. In particular, fiat money used in e-wallet-type applications should be called "fiat electronic money". Bitcoin is called "digital currency" and stablecoin is  called "stable cryptocurrency".

As for the case of CBDC, he suggested calling this "central digital currency" to make it easy to distinguish. For the digital currency issued by the State Bank of Vietnam, the expert said this should be called "VND digital money".

Trong Dat

MORE NEWS

Vietnam to attend ASEAN Tourism Forum 2023 in Indonesia

Vietnam will participate in ASEAN Tourism Forum (ATF) 2023 themed “ASEAN: A Journey to Wonderful Destinations”, and the Travel Exchange (TRAVEX) trade fair in Yogyakarta, Indonesia from February 2 – 5.

Hanoi and Ho Chi Minh City among safest cities in Southeast Asia

Hanoi and Ho Chi Minh City have both been included in a list of the safest cities in Southeast Asia, as compiled by statistics site Numbeo.

Action plan issued to accelerate national anti-corruption strategy building

Deputy Prime Minister Le Minh Khai, head of the steering committee on building the national anti-corruption strategy by 2030, has signed a decision on the issuance of the committee’s action plan.

VIETNAM BUSINESS NEWS JANUARY 31/2023

Latest guidance on one-way money transfers from Viet Nam

HCM City proposes removing hindrances to develop real estate market

Ho Chi Minh City authorities made a proposal to clear bottlenecks for healthy and sustainable development of the real estate market.

More high-value foreign investment projects needed as tax policies change

Vietnam needs to improve FDI quality, attracting high-tech projects that promise to bring higher added value.

Khmer's ginger cake of love and faithfulness

The ginger cake of the Khmer ethnic group in Soc Trang Province is a beloved traditional treat that is often offered to ancestors on important anniversaries such as the Tet (Lunar New Year) festival.

HCM City promotes digital transformation in education

Digital transformation is considered key to improving education and training quality, as proven by the effect of HCM City actively applying digital transformation over the past five years.

Hanoi to close fruit shops lacking proper food safety preparations

The capital city of Hanoi encourages the expansion of safe fruit businesses while clamping down on fruit shops that do not comply with food safety protocols, specifically street vendors.

Dutch diplomat donates Vietnamese paintings to national museum

Vietnam National Fine Arts Museum has received two paintings from former deputy ambassador Ellen Berends of the Netherlands to Vietnam.

Hanoi's unique rice cooking contest in photos

On the 8th day of the first lunar month each year (January 29, 2023), Thi Cam village in Hanoi’s Nam Tu Liem district holds a rice cooking contest.

Hanoi proceeds with park revitalization program

The implementation of Hanoi leaders’ promise to revive parks has begun: admission to Thong Nhat Park is now free after the removal of the fence, and Con Coc Flower Garden has a new look. However, there are still many things that need to be done.

Vietnamese farmers on board the ‘digital agriculture train’

In the digital era, next-generation farmers can fertilize and water their fields in Binh Phuoc from afar, even in a different country.

Vietnam forecast to become second-largest economy in Southeast Asia by 2036

2023 is predicted to be the year of many challenges for the Vietnamese economy due to the gloomy outlook of the global economy and multiple crises.

Prenn Pass leading to Dalat to be closed for expansion

Vehicles will be banned from using the seven-kilometer-long Prenn Pass to travel to Dalat City as work on the pass upgrade and widening project begins on February 6.
back_to_top