On June 14, 2025, the National Assembly of Vietnam officially passed the Digital Technology Industry Law, marking a significant shift in managing the country's digital assets. Effective from January 1, 2026, this law not only sets clear regulations for the rapidly developing cryptocurrency sector in Vietnam but also reflects the government's determined efforts to enhance financial credibility and escape the grey list of the Financial Action Task Force (FATF).
With the enactment of this law, Vietnam has established a comprehensive legal framework for digital assets, including the classification of digital assets, licensing requirements, and strict supervision mechanisms, in line with international standards. By closely managing the cryptocurrency sector, Vietnam not only aims to address concerns from FATF but also build a solid foundation to attract investor confidence while asserting its position as a leading digital economy hub in Southeast Asia.
This article will analyze how reforms in the cryptocurrency sector support Vietnam's strategy to escape FATF's grey list, while clarifying key points in Vietnam's cryptocurrency law and how this law addresses FATF's concerns.
What is FATF?
Established in 1989 by the G7, FATF is a global organization tasked with setting standards to combat money laundering, terrorist financing, and other threats to the international financial system. FATF not only develops these policies but also monitors their implementation in member countries. The G7 is an intergovernmental organization comprising seven of the world's largest economies: Canada, France, Germany, Italy, Japan, the UK, and the USA.
FATF provides directional recommendations for countries to develop internal laws and policies while assessing compliance through peer reviews. Countries that do not sufficiently meet these standards may be placed on the ‘grey list’ or ‘black list’, which can harm the country's international financial reputation and negatively impact the investment environment.
To escape this situation, Vietnam aims to comply with FATF rules. Through this, the country hopes to attract venture capital funds and international cryptocurrency exchanges while turning regulatory clarity into an essential tool for driving economic development in the digital age.
The status of FATF's grey list and steps towards financial reform in Vietnam
In June 2023, Vietnam was officially placed on FATF's grey list, officially termed as 'jurisdictions under increased monitoring'. This decision came after Vietnam agreed to address some serious shortcomings in its Anti-Money Laundering (AML) and Counter-Terrorist Financing (CFT) measures.
FATF has pointed out several major issues in Vietnam's financial system, including:
Inadequate monitoring of financial institutions has led to loose control over financial activities.
Weak customer due diligence (CDD) has made financial institutions vulnerable to exploitation for illegal activities.
Inadequate regulations for virtual asset service providers, a rapidly growing sector lacking proper oversight.
Insufficient efforts to prevent illegal financing related to the proliferation of weapons, an issue that has raised concerns in the international community.
To escape the grey list, Vietnam needs to fully and seriously implement FATF's action plan. Key steps in this process include:
Strengthening AML/CFT measures to meet international standards.
Improving regulatory oversight to ensure all financial institutions strictly comply with legal regulations.
Enhancing the CDD process to ensure all transactions are controlled and transparent.
Ensuring effective prosecution of financial crimes while strengthening the legal system to address violations.
FATF will monitor Vietnam's progress through periodic updates and field visits. When reform measures are successfully implemented and compliance is clearly demonstrated, member countries will vote in a plenary session to decide whether to remove Vietnam from the grey list. This is an important step, not only demonstrating trust in Vietnam's financial integrity but also facilitating increased international investment and promoting future economic development.
Vietnam's Digital Technology Industry Law
In June 2025, Vietnam became the first country in the world to pass an independent law dedicated to the digital technology industry. Officially passed, this law will take effect from January 2026, marking a significant step in laying the legal foundation for the development of the digital technology sector in the country.
Below are the highlights of the Digital Technology Industry Law:
1. Ambitious growth
This law aims to create 150,000 digital technology companies by 2035 through the ‘Make in Vietnam’ initiative. This is a strong step for Vietnam to become a technology hub in Southeast Asia and the world, particularly in areas such as blockchain, AI, and cloud technology.
2. Clear classification of digital assets
The law clearly distinguishes between cryptocurrency assets (e.g., Bitcoin, Ether) and virtual assets (non-financial digital items). This helps Vietnam manage risks more accurately while complying with FATF guidelines, ensuring transparency and safety in digital financial activities.
3. Strong incentives for businesses
To attract technology companies, the Digital Technology Law provides tax incentives, subsidies, and exemptions from import taxes for startups, small and medium-sized enterprises (SMEs), and foreign technology investors. These policies aim to encourage investment and innovation development in the digital technology sector.
4. Supporting workforce development
Vietnam will exempt domestic digital experts from taxes for 5 years while providing 5-year visas for foreign experts without requiring work permits. This helps attract international talent and develop high-quality human resources in digital technology sectors.
5. Regulations on AI and digital assets
The law also provides a legal framework for AI (artificial intelligence) based on risk, along with regulations for digital assets such as cryptocurrencies and virtual assets. These regulations help establish a clear and safe legal environment for the sustainable development of new technologies.
6. Regulatory sandbox
The law also allows for controlled testing of blockchain technologies, DeFi, and virtual assets in a framework called a ‘regulatory sandbox’. This is a measure to promote innovation, allowing companies to test new technologies without facing overly strict legal barriers.
A deeper look at Vietnam's cryptocurrency law
Vietnam's Electronic Money Law, an important part of the Digital Technology Industry Law, has officially classified digital assets into two main groups: Virtual assets and Cryptocurrency assets. This is a significant step in forming a clear legal framework for managing digital assets, thereby promoting the development of the domestic digital technology industry.
1. Classification of digital assets
Virtual assets and cryptocurrency assets are clearly distinguished in the law, with the following characteristics:
Virtual assets: Includes non-financial digital items, primarily used for exchange or investment. However, these assets do not include securities, central bank digital currencies (CBDC), fiat money, or traditional financial instruments. Virtual assets can encompass digital products that do not directly serve financial activities, such as online game items or digital art items (NFT).
Cryptocurrency assets: These are digital assets that use encryption or blockchain technology to manage issuance, transfer, and storage. Similar to virtual assets, cryptocurrency assets do not include securities or CBDC. They include coins like Bitcoin, Ether, and other cryptocurrencies related to blockchain technology.
2. Legal framework for digital assets
This clear classification creates a structured legal framework, enabling the government to easily manage digital assets while maintaining a clear distinction between digital assets and traditional financial products. Specifically, the law clearly stipulates licensing mechanisms, supervision, and operational guidelines for each type of asset, including cryptocurrencies and virtual assets, aimed at protecting investors and maintaining transparency in this field.
This creates opportunities for companies, especially blockchain startups and international investors, to operate confidently in a stable and safe legal environment.
3. Key features of the cryptocurrency law
Legal recognition: Startups in the cryptocurrency sector will be legally recognized, helping to promote the development of domestic blockchain services and products.
Regulatory framework: The law provides a clear regulatory framework for cryptocurrency companies, from licensing operations to compliance with international AML/CFT standards.
Tax incentives: Some tax incentives and subsidies will be provided to startups in the cryptocurrency sector, helping them alleviate financial burdens while developing products and expanding operations.
Pilot testing: The law also includes provisions for a pilot testing mechanism, allowing companies to test virtual asset-related products and services in a controlled framework before official application.
Training and human resource development: Tax-exempt programs, subsidies, and training for the workforce in the blockchain industry are also included in the law, aiming to enhance capacity for domestic professionals and attract international talent.
4. International cooperation and fraud management
One of the key points of the cryptocurrency law is the ability for international cooperation in addressing issues related to digital asset fraud. Vietnam commits to improving cross-border investigations, helping to limit global cryptocurrency crime and ensuring that cryptocurrency companies comply with international regulations on financial security and transaction transparency.
This not only helps Vietnam build a safe cryptocurrency ecosystem but also enhances the country's reputation in the international community, thereby attracting investment and international transactions into the crypto market.
How does Vietnam address FATF's concerns?
Not only is this an important milestone domestically, but Vietnam's Digital Technology Industry Law also represents a significant step in aligning the country's digital asset sector with global FATF standards on AML/CFT.
Highlights of the Digital Technology Industry Law
Legalizing cryptocurrency: The 2025 law marks the end of legal ambiguity regarding cryptocurrency by recognizing ownership and use of these digital assets. This is an important step in aligning with FATF's requirements, as the organization urges countries to establish clear and transparent regulations regarding digital assets.
Clear classification of asset categories: One notable point is the separation of cryptocurrency assets (such as Bitcoin, Ether) from virtual assets (non-financial digital items). This regulation helps manage risks more accurately according to FATF guidance, creating a clear and manageable legal framework.
Integration of AML/CFT measures: Cryptocurrency exchanges and wallet providers will be under state supervision, addressing FATF's concerns about weak customer due diligence and illegal financial activities. This helps Vietnam build a transparent digital financial system, minimizing risks related to fraud and financial terrorism.
Separate management of Stablecoins: Stablecoins, cryptocurrencies backed by fiat money, will be managed separately under financial law. This ensures consistent oversight while minimizing systemic risks, in line with the risk-based approach recommended by FATF.
Transparency for businesses: Clear and transparent regulations in the law will help attract cryptocurrency startups and formalize this industry. This aids in transaction monitoring, enforcing KYC regulations, and reducing capital flight, thereby enhancing market stability and reliability.
Reforms in the Digital Technology Industry Law support Vietnam's strategic goal of escaping FATF's grey list. Specifically, the law creates a transparent, tightly controlled cryptocurrency environment in compliance with international standards, helping restore international community confidence in Vietnam's financial ecosystem.
Furthermore, this law empowers the government to determine licensing rules, asset classification, and supervision mechanisms for financial activities. This ensures that cryptocurrency service providers and financial institutions operate in a tightly regulated and monitored environment.
Through these measures, Vietnam is not only demonstrating a strong commitment to meeting international standards but also proving its ability to innovate and develop sustainably in the digital finance sector. This law restores international confidence and positions Vietnam as an ideal destination for investors and businesses in the global fintech industry.
Vietnam's new cryptocurrency law helps authorities combat digital asset fraud
Vietnam's new cryptocurrency law not only marks a turning point in developing the digital technology industry but also serves as an important legal tool in the fight against digital asset fraud. Previously, the lack of legal tools was one of the obstacles for authorities in investigating and handling financial fraud cases. The new law establishes a clear legal framework, helping authorities rigorously enforce measures such as identity verification, transaction monitoring, and reporting obligations.
Two prominent fraud cases
Two recent fraud cases in Vietnam have highlighted the urgency of these reforms:
1. The BitMiner case (February 2025): Authorities arrested four individuals behind BitMiner, a fraudulent cryptocurrency mining program, deceiving 200 victims with amounts exceeding 4 billion VND.
2. The Million Smiles case (December 2024): Hanoi police broke up a cryptocurrency scam involving Million Smiles, exploiting fake advertisements to solicit investments in a cryptocurrency named QFS, causing losses of approximately 30 billion VND.
These incidents indicate that without a clear and strict legal framework, fraudulent activities involving digital assets can easily develop and cause significant harm to the economy.
Vietnam's cryptocurrency law has introduced specific AML/CFT measures, requiring cryptocurrency service providers to fulfill obligations such as:
Customer identity verification (KYC)
Transaction monitoring to detect suspicious activities
Reporting obligations for suspicious transactions to authorities
These regulations not only create a transparent legal environment for the cryptocurrency industry but also help prevent fraudulent activities and protect investors' rights.
In addition, Vietnam's new cryptocurrency law also facilitates international cooperation in cross-border investigations. Given the global nature of cryptocurrency fraud cases, Vietnam's adjustment of cryptocurrency regulations according to international standards is a crucial factor in enhancing coordination with international authorities.
Especially in cases of transnational cryptocurrency crimes, where assets and suspects often cross jurisdictions, having a unified legal framework will help mitigate risks and enhance enforcement effectiveness.
It cannot be denied that Vietnam's inclusion in FATF's grey list has had negative impacts on the country's reputation and international financial cooperation. Foreign banks may hesitate to work with domestic institutions, reducing the flow of capital and international investment.
However, through strong reforms in the cryptocurrency law, Vietnam has demonstrated a commitment to improving the financial environment and building a tightly supervised financial system, minimizing risks and bolstering national credibility. These measures will not only help Vietnam escape the grey list but also restore international trust, opening up opportunities for cooperation and investment in the future.
Opening doors for digital innovation
Vietnam's new cryptocurrency law is not only a significant legal event but also part of the country's ambitious strategy to become a leading digital technology hub in Southeast Asia. By officially recognizing cryptocurrency assets, the Vietnamese government not only opens new opportunities for innovation but also attracts startups and international investors, affirming the country's position on the global technology map.
Significant incentives for technology companies under this law include:
Tax reductions for companies designing and developing advanced technologies such as blockchain, AI, and electronic chips.
Providing subsidies and supporting access to digital infrastructure and innovation parks, facilitating sustainable and dynamic development.
Investing in funding systems and infrastructure for R&D in semiconductor and cloud technology fields, promoting technological advancement in core areas.
In addition, the Vietnamese government is also actively investing in digital education through vocational training programs, cooperation between universities and industries, along with technology vocational programs. This not only helps provide a skilled workforce but also creates a solid foundation for the future development of the digital technology sector.
Through these comprehensive efforts, Vietnam is building a robust innovation ecosystem, contributing to the country's emergence as a leading digital innovation hub in Southeast Asia.
Global image assessment and Vietnam's future according to FATF
Vietnam's cryptocurrency law has become a focus in the strategy to comply with FATF standards, particularly in addressing issues outlined in its grey list. By clearly defining types of virtual and cryptocurrency assets, as well as establishing licensing rules, AML/KYC, cybersecurity, and transaction monitoring, Vietnam is self-regulating according to FATF's Recommendation 15, one of the key requirements to be removed from the grey list.
At the same time, the State Bank of Vietnam has tightened regulations on anti-money laundering, updated risk assessments, standardized reporting practices, and enhanced CDD under the amended Circular 09. If fully implemented by January 2026, these reforms will facilitate Vietnam's exit from the grey list while reaffirming the country's commitment to improving the quality of international financial oversight.
In addition to ensuring compliance with international standards, this clear regulatory environment also helps enhance investor confidence. Legalizing cryptocurrency exchanges and establishing strict compliance standards will reassure international cryptocurrency businesses, venture investors, and technology companies. Furthermore, the seamless integration between cryptocurrencies and traditional banking not only improves access to capital markets but also creates more sustainable financial opportunities.
Finally, Vietnam's cryptocurrency regulations not only address FATF's concerns but also enhance the global image of the country as a transparent and innovation-friendly economy. Vietnam is creating an ideal environment to foster innovation in the digital technology sector while bolstering confidence from the international financial community.