Despite the government’s statement assuring that the fiat currency of the country would not be replaced by a sovereign digital currency, Vietnam achieved the status of the latest country to explore the possibility of launching a CBDC (central bank digital currency).
The investigation of Vietnam over cryptocurrency
Nikkei Asia (a Tokyo-based English news magazine) stated on 12th July 2021 that the decision of Prime Minister Nguyen Xuan named Decision 942, which was taken in June aiming at the creation of e-government, has been the driving force behind the plan regarding the creation of a digital currency.
The coordinator at Vietnam’s RMIT University’s Hub regarding financial technology and cryptocurrency, Binh Nguyen Thanh, suggested that the creation of a digital currency might be expedited by the development policy of the e-government. Thanh added that the government should have an observation over the current initiatives taken by the other countries.
He further described that the country is working for the development of a regularity sandbox regarding financial technology in which a pilot program for digital currency would also be included. However, the Vietnamese dong cannot be substituted by a CBDC.
It has been recently requested by the Vietnamese government to the country’s state bank (SBV) that it should conduct a trial for a digital currency based on blockchain. The implementation of the trial plan would be completed by 2023.
The blockchain technology experimentation of Vietnam
Although Vietnam seems to have become one with the other countries analyzing the CBDCs, it has not ever shown any consideration regarding Bitcoin (BTC). The Prime Minister of Vietnam in 2018, Nguyn Xuan (who is currently the President of the country), issued an order for the financial institutions to halt their services for providing anything to the crypto customers.
During that year, a ban was proposed by the finance minister of the country over the imports containing crypto-mining devices. The authorities have also prohibited the companies from trading cryptocurrency. In the later phase of 2020, the former commander of police issued a warning against any type of participation in BTC frauds.
However, a declaration about the consideration of allocating a research panel for the analysis and suggestions about some regulatory principles regarding the crypto industry was made by the Finance Ministry of Vietnam.
CBDCs are acquiring a lot of attention as many central banks are experimenting on pilot programs for devising possible ways to launch their digital currency.