According to Chainalysis, Vietnam ranks top 3 in Global Crypto Adoption Index. It was estimated that $120 billion worth of cryptocurrencies flowed to Vietnam from July 2022 to July 2023, an increase of 20 percent compared to the $100 billion in 2021-2022.

Chainalysis estimated that the total profit of digital asset investors globally in 2023 was $37.6 billion and Vietnam ranked third with $1.2 billion.

The majority of cryptocurrencies in Vietnam (60 percent) are being traded at CEX (centralized exchanges). According to Triple A, 20 percent of the Vietnamese population have virtual assets and the number of people in Vietnam with digital assets ranks third in terms of absolute quantity.

Taxing virtual asset transactions

At the Blockchain & AI Forum held recently, Phan Duc Trung, deputy chair of the Vietnam Blockchain Association, cited a report by Triple A as showing that up to 85 percent of freelancers in Vietnam have digital assets and 35 percent of them accept payments in digital assets, though this violates current laws.

Trung said that blockchain now exists as an ‘underground economy’ of Gen Z (those who were born after 1997) and freelancers.

He said that the cash flow rotating within the virtual economy is high and if Vietnam continues to prohibit cryptocurrencies or avoids regulations on blockchain and virtual assets, Vietnam will miss great opportunities. 

Instead of probation, it would be better to have a legal framework to manage virtual assets, which would step by step turn the underground economy into public economy, thus helping economic growth. 

“In the future, we may be able to collect taxes from virtual assets, like taxes from securities transactions,” he said.

Virtual asset management

A survey conducted by Atlantic Council in December 2023 on 60 countries found that 32 countries have recognized virtual assets as legal assets, while 19 countries prohibit virtual assets partially and eight countries apply full prohibition. Ten member countries in G20 have legalized this type of asset.

According to Lawyer Tran Quoc Bao from Pantheon Law Firm, since virtual asset is a new matter, 70 percent of countries still don’t have their own legal frameworks to control virtual assets and virtual asset trading floors.

In the region, Thailand and Singapore are open in this field, but Vietnam still doesn’t have any legal framework for this.

Trong Dat