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Vietnam to start scrutinising legal framework for official recognition of Bitcoin and other cryptocurrencies

Vietnam’s office state news provider, the Vietnam News Agency (VNA) reported that the Prime Minister (PM), Nguyen Xuan Phuc, has approved a plan to scrutinise and streamline the legal framework for the management of cryptocurrencies such as Bitcoin in Vietnam. The press release states that it is expected that such currencies will be recognised legally in the country soon.

The PM has asked the Ministry of Justice (MoJ) to preside and co-ordinate with other relevant ministries and institutions, including the State Bank of Vietnam, Ministry of Information and Communications, Ministry of Public Security, Ministry of Industry and Trade and Ministry of Finance, to scrutinise the current legal framework. The MoJ will provide a comprehensive assessment and propose suitable solutions and revisions in the framework to the government.

According to the PM’s decision, the deadline for completing the assessment is August 2018, and all legal normative documents on the currencies must be ready by the end of next year.

The ministries will also have to finalise an application asking for the compilation of a legal framework on taxes for cryptocurrencies by June 2019. By September of the same year, proposals for prevention and handling of violations related to these currencies must be in place.

The plan also takes into consideration the need for institutional construction to protect Vietnam’s property rights, which will contribute towards protecting the rights and interests of domestic and foreign investors.

It is expected that once the legal framework for the currencies is finalised, Bitcoin and several other cryptocurrencies will be officially recognised in Vietnam, opening up possibilities in financial technology and online payments.

This is a shift from the previously cautious approach of the government of Vietnam towards cypto-currencies such as Bitcoin. In 2014, the State Bank of Viet Nam (SBV), the central bank of the country, announced that bitcoins and other cryptocurrencies are not legal tender or permitted means of payment in Viet Nam.

Bitcoins and other cryptcurrencies are not backed by any government or central bank, unlike the official currencies. Most countries do not make the usage of Bitcoin itself illegal, though many central banks have sounded a cautionary note on the risks associated with its usage.  Many have chosen to take a hands-off approach but the extent of regulation varies from country to country. 

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