The Ultimate Crypto Exchange: A Fine-Tuned, Comprehensive Strategy

A comprehensive and balanced approach is needed for a pilot cryptocurrency exchange. (Photo: HAI NAM)

During a working session with the Central Strategic Policy Committee on economic growth objectives in late February 2025, Party General Secretary To Lam instructed the team to explore the application of a controlled trial mechanism (sandbox) for establishing a cryptocurrency exchange as a virtual asset entity. The primary objective is to mitigate potential negative impacts on the economy and society while contributing positively to the country’s economic growth.

Learning from International Experiences

If we liken the economy to a river, cryptocurrency is a new, rapidly flowing tributary that brings both opportunities and risks. While this flow cannot be stopped, it must be properly regulated to prevent financial instability. The challenge lies in channeling this “flow” to maximize benefits while minimizing risks to the financial system.

There remains a lack of global consensus on the classification of digital currencies as money, commodities, assets, or securities in legal frameworks. Some countries, such as China, enforce strict prohibitions on digital currency transactions due to concerns over financial control, economic stability, and political risks. In contrast, many other nations have embraced a more open approach.

In the United States, the legal perspective on digital currencies varies depending on the regulatory agency and context. While the US government does not recognize cryptocurrencies like Bitcoin as legal tender, the Financial Crimes Enforcement Network (FinCEN) under the US Department of the Treasury considers cryptocurrencies as “money” in specific cases related to anti-money laundering (AML) and counter-terrorism financing (CTF).

Since 2015, the Commodity Futures Trading Commission (CFTC) has officially categorized Bitcoin and Ethereum as commodities. On the other hand, the Internal Revenue Service (IRS) has treated digital currencies as assets rather than currency since 2014, subjecting transactions such as buying, selling, exchanging, and mining to taxation, similar to other asset transactions.

The US Securities and Exchange Commission (SEC) does not classify all digital currencies as securities. However, a digital currency issued through an initial coin offering (ICO) or possessing characteristics of an investment contract may be deemed a security.

With the rapid evolution of information technology, digital currencies are not a passing fad but a potentially irreversible phenomenon.

Proposals for Vietnam

According to several international reports, Vietnam has one of the highest rates of digital currency ownership and transaction activity globally. However, these figures are primarily based on estimates from foreign organizations’ online surveys. The Vietnam Blockchain Alliance references statistics from various institutions, indicating that inflows of digital assets into Vietnam reached 105-120 billion USD in 2023.

When forming policies for digital assets, it is essential to recognize the close linkage between their value and the Vietnamese dong. Vietnam has a unique opportunity to shape this market proactively rather than letting it develop without oversight.

The controlled pilot mechanism for digital currencies should be approached with caution and pragmatism. Developing a robust legal framework is a complex and time-consuming task. Therefore, alongside the pilot period, expected to last one to two years, ongoing evaluations and experience gathering are crucial for refining the regulations. The exchange can be state-owned or operated by licensed private entities.

During the pilot phase, digital currency should be recognized solely as an “asset” rather than a means of payment. All transactions on the exchange should be conducted in Vietnamese dong, and investors should have the option to open foreign currency accounts on the platform.

The use of foreign currencies or the Vietnamese dong to trade international digital currencies (such as Bitcoin, Ethereum, and Solana) should be carefully regulated under foreign exchange management and anti-money laundering policies. At the same time, exchange operations should maintain a degree of flexibility.

Additionally, stringent anti-money laundering (AML) measures and Know Your Customer (KYC) procedures are essential to monitor transactions effectively. Blockchain technology inherently records all transactions permanently, enabling traceability when combined with appropriate monitoring tools.

Integrating Vietnam’s national population database, managed by the Ministry of Public Security, with the KYC procedures on the exchange can enhance security. A critical factor in the success of a digital currency exchange is market and investor confidence. Therefore, implementing mechanisms to protect investors and ensure liquidity on the exchange is of utmost importance.

Information technology has been reshaping the world at an unprecedented pace, and each country must find its own path to integration. Digital currency is a prime example of this transformation. A comprehensive and balanced perspective is necessary to navigate this entirely new terrain effectively.

Vietnam’s economy is a complex system, and maintaining equilibrium between tangible currencies and assets is crucial when establishing a digital currency exchange or trading tokenized and digital assets in the future. Following the principle of “quantitative change leading to qualitative change,” the controlled pilot of digital currency represents a historical milestone, paving the way for a new era of robust national development.