On June 14, 2025, the National Assembly officially passed the Digital Technology Industry Law – a significant milestone in the journey to complete the legal framework for the digital asset sector. This law will come into effect on January 1, 2026, providing a clear legal framework for the rapidly growing cryptocurrency industry in Vietnam. At the same time, this is part of a strategic effort to improve the national financial image and aim for removal from the gray list of the Financial Action Task Force (FATF).

The new law – A comprehensive legal framework for digital assets

With the passage of this law, Vietnam has become the first country in the world to enact a specific law for the digital technology sector. The law classifies digital assets, sets licensing requirements, and establishes strict compliance mechanisms in line with international standards. Through strict management of the cryptocurrency sector, Vietnam hopes to address concerns from the FATF, strengthen investor confidence, and assert its position as a digital economy center in Southeast Asia.

About FATF and the gray list

Established in 1989 by the G7, the FATF is a global organization that sets standards for anti-money laundering, counter-terrorist financing, and threats to the international financial system. Countries that do not meet FATF standards may be placed on the 'gray' or 'black' lists, severely impacting their financial reputation and ability to attract international investment.

Vietnam has been placed on the FATF gray list since June 2023 due to numerous gaps in financial oversight, customer due diligence (CDD), and lack of control over virtual asset service providers. The FATF also expressed concerns about the ability to prevent funding related to the proliferation of weapons of mass destruction.

Highlights of the Digital Technology Industry Law

  • Bold growth targets: Aiming to build 150,000 digital technology enterprises by 2035 under the 'Make in Vietnam' initiative.

  • Clear classification: Digital assets are divided into two groups:

    • Virtual assets: Non-financial digital assets (e.g., virtual items), excluding securities, fiat money, or CBDC.

    • Cryptographic assets (crypto): Digital assets that use cryptographic or blockchain technology, including Bitcoin, Ethereum… but also excluding CBDC, stablecoins, or securities.

  • Sandbox mechanism: Allows controlled experimentation with blockchain technology, DeFi, and digital asset products.

  • Strong incentives: 4 years of tax exemption, subsidies, and import tax exemptions for startups and foreign technology investors. Vietnamese technology experts are exempt from tax for 5 years; foreign experts are granted a 5-year visa without needing a work permit.

  • Legal framework for AI and digital assets: Implementing risk-based management, closely following FATF's guidance.

Vietnam's solutions to address FATF's requirements

The Digital Technology Industry Law not only has domestic significance but also serves as a strategic lever to help Vietnam escape the FATF gray list:

  • Legal recognition of cryptocurrency: Ending the 'gray area' of legality by officially recognizing ownership and use of crypto.

  • Implementing risk management: Clearly classifying assets, excluding stablecoins from the scope of the law, and applying separate oversight under financial laws.

  • Strengthening AML/CFT: Crypto exchanges and wallets must comply with regulations on identity verification, transaction monitoring, and reporting suspicious activities.

  • International cooperation: Facilitating coordination with foreign agencies in cross-border digital asset fraud investigations.

Notable cases and the urgency of the new law

Recent scams highlight the urgency of legal reforms:

  • February 2025: Four individuals behind the BitMiner scam were arrested for embezzling over 4 billion VND from 200 people.

  • December 2024: Hanoi police dismantled the 'Million Smiles' organization promoting the QFS coin, which defrauded over 1.17 million USD.

The new law provides authorities with tools to investigate, prosecute, and effectively prevent digital asset fraud – a capability that was very limited before.

Vietnam – A digital technology innovation center in the region

Through the new law, Vietnam is demonstrating its ambition to become a regional digital technology innovation hub:

  • Strong support for R&D: Providing scholarships, subsidies, and infrastructure for chip research, cloud computing, and AI.

  • Human resource development: Investment in vocational training, cooperation between universities and businesses, and high-tech internship programs.

Impact on international image and the upcoming FATF assessment

The issuance of the Digital Technology Industry Law is an important step in Vietnam's FATF compliance strategy. This law specifies the requirements outlined in FATF Recommendation 15, one of the main reasons Vietnam was placed on the gray list. Simultaneously, the State Bank has also amended Circular 09, enhancing the CDD process, standardizing reporting, and tightening AML regulations.

If measures are fully implemented before January 1, 2026, Vietnam has a great opportunity to be removed from the gray list – thereby improving international capital flows, attracting startups and venture investors, and enhancing connections between the traditional financial system and the digital economy.