Vietnam Takes Bold Steps Toward Regulating Cryptocurrency Markets

A New Tax Framework Aligns Digital Assets with Traditional Securities

Vietnam is making significant moves to bring cryptocurrency into its formal financial regulatory system, proposing a comprehensive tax framework that treats digital assets similarly to traditional securities like stocks. The Ministry of Finance has circulated a draft policy that outlines how individuals and companies would be taxed on their cryptocurrency transactions, signaling the country’s intent to legitimize and regulate what has become a thriving digital asset market. According to local reporting from The Hanoi Times, individual investors who transfer cryptocurrency through licensed service providers would pay a 0.1% personal income tax on each transaction’s value—exactly the same rate currently applied to stock trading in Vietnam. This approach suggests that Vietnamese regulators view cryptocurrency not as an experimental technology or a speculative asset class entirely separate from traditional finance, but rather as a legitimate investment vehicle that deserves similar treatment to established securities markets. The draft policy has been released for public consultation, giving stakeholders an opportunity to provide feedback before the regulations are finalized and implemented.

The proposed taxation structure makes important distinctions between different types of transactions and different types of investors. While cryptocurrency transfers and trading would be classified as exempt from value-added tax (VAT), the turnover-based tax would still apply to investors making transfers, regardless of whether they’re Vietnamese residents or foreigners conducting transactions within the country’s jurisdiction. This residency-neutral approach ensures that the tax framework captures all cryptocurrency activity happening through Vietnam’s licensed platforms, preventing regulatory arbitrage where foreign investors might otherwise avoid taxation. For corporate entities operating within Vietnam, the tax treatment differs considerably from that of individual investors. Institutional investors and companies earning income from cryptocurrency transfers would face a 20% corporate income tax, though this would be calculated on actual profits after deducting the original purchase costs and any related expenses. This profit-based taxation for corporations, as opposed to the transaction-based tax for individuals, reflects standard corporate tax principles and acknowledges that businesses operate with different economic considerations than individual retail investors.

Defining Cryptocurrency and Setting Operational Standards

Beyond taxation, the draft policy provides Vietnam’s formal legal definition of cryptocurrency assets for the first time, a foundational step that brings clarity to what has previously existed in a regulatory gray area. Vietnamese authorities describe crypto assets as digital assets that rely on cryptographic technologies or similar technical approaches for their issuance, storage, and transfer verification. While this definition may seem technical, it’s actually quite significant because it establishes the legal boundaries of what will be regulated under this new framework. By grounding the definition in the underlying technology—cryptography—rather than specific use cases or particular cryptocurrencies, Vietnam’s regulators have created a flexible framework that can accommodate the rapid evolution of digital asset technology without becoming immediately outdated. This technology-based definition would presumably cover Bitcoin, Ethereum, and other established cryptocurrencies, as well as newer digital assets that emerge using similar cryptographic verification methods.

The draft policy also establishes extraordinarily high barriers to entry for companies hoping to operate cryptocurrency exchanges in Vietnam. Firms seeking to run a digital asset exchange would need charter capital of at least 10 trillion Vietnamese dong, which translates to approximately $408 million at current exchange rates. To put this figure in perspective, this capital requirement is actually higher than what’s required for commercial banks in Vietnam and dramatically exceeds capital standards in most other industries. This substantial financial threshold serves multiple regulatory purposes: it ensures that only well-capitalized, serious financial institutions can operate in this space; it provides a substantial buffer to protect consumers in case an exchange faces financial difficulties; and it filters out smaller operators who might lack the resources to implement robust security and compliance systems. The draft also addresses foreign investment in cryptocurrency exchanges, permitting international ownership but capping it at 49% of an exchange’s equity. This restriction ensures that Vietnamese interests maintain majority control over crypto infrastructure operating in the country, while still allowing access to foreign capital, expertise, and technology that international investors might bring.

Vietnam’s Remarkable Cryptocurrency Adoption Rate

These regulatory developments come against the backdrop of Vietnam’s remarkable position as one of the world’s leading cryptocurrency markets. According to data from blockchain analytics firm Chainalysis, Vietnam ranks fourth globally in cryptocurrency adoption, a striking achievement for a country that has historically maintained tight controls over financial markets and capital flows. This high adoption rate reflects several factors, including a young, tech-savvy population, growing middle-class wealth seeking investment opportunities, and perhaps some hedging against local currency volatility and inflation concerns. The popularity of cryptocurrency in Vietnam has created both opportunities and challenges for regulators, who must balance the desire to support financial innovation and provide Vietnamese citizens with legitimate investment options against concerns about consumer protection, financial stability, and potential illicit uses of digital assets.

The Vietnamese government’s response to this widespread crypto adoption has been to launch a structured, phased approach toward regulation rather than imposing outright bans as some countries have done. In September 2025, Vietnam initiated a five-year pilot program for a regulated crypto asset market, designed to test regulatory approaches and allow the market to develop under government supervision before potentially implementing permanent regulations. However, the program got off to a slow start—by October 6, 2025, Vietnam’s Ministry of Finance confirmed that no companies had yet applied to participate in the pilot program. The reason for this lack of initial interest was clear: the high capital requirements and strict eligibility conditions were deterring potential applicants. The 10 trillion dong capital requirement represents a massive investment that even established financial institutions would need to carefully consider, and the comprehensive compliance obligations likely require substantial legal and operational preparation before companies feel ready to apply.

Opening the Door to Licensed Cryptocurrency Exchanges

Despite the initially slow uptake, Vietnam has continued moving forward with its regulatory framework. Last month marked a significant milestone when the country began accepting applications for licenses to operate digital asset trading platforms, representing the operational launch of the planned pilot program. The State Securities Commission of Vietnam (SSC), the country’s securities regulator, announced that “applications for the aforementioned administrative procedures will be accepted beginning January 20, 2026,” framing this development as part of a broader governmental effort to bring cryptocurrency under formal regulatory oversight. By assigning responsibility for cryptocurrency regulation to the SSC rather than creating an entirely new regulatory body, Vietnam is reinforcing the conceptual alignment between digital assets and traditional securities, suggesting that the regulatory approaches, investor protections, and market surveillance techniques developed for stock markets will be adapted for cryptocurrency markets.

The licensing process represents a critical juncture for Vietnam’s cryptocurrency industry. Companies that successfully navigate the application process and meet the stringent capital and operational requirements will gain legitimate status and the ability to operate openly in one of Asia’s most dynamic crypto markets. For investors, licensed exchanges should offer greater security and consumer protection compared to unregulated platforms, with regulatory oversight potentially reducing the risks of fraud, manipulation, and exchange failures that have plagued cryptocurrency markets globally. For the Vietnamese government, the licensing system provides visibility into cryptocurrency markets that have previously operated in semi-formal or informal spaces, allowing for better monitoring of financial stability risks, tax compliance, and potential money laundering or other illicit activities. The success or failure of this licensing initiative during the five-year pilot period will likely shape Vietnam’s long-term approach to cryptocurrency regulation and could influence regulatory thinking in other Southeast Asian nations watching Vietnam’s experiment with interest.

Balancing Innovation, Regulation, and Financial Inclusion

Vietnam’s emerging cryptocurrency framework represents a pragmatic middle path between the extremes of prohibition and unregulated permissiveness. Rather than banning cryptocurrency outright as China has done, or allowing it to develop in a largely unregulated environment as some jurisdictions have, Vietnam is attempting to create a structured regulatory environment that legitimizes cryptocurrency while imposing meaningful oversight and consumer protections. The 0.1% transaction tax for individuals is modest enough that it shouldn’t significantly discourage trading, while still generating tax revenue and creating a paper trail of transactions. The 20% corporate income tax on crypto-related profits aligns with general corporate taxation principles and ensures that businesses profiting from cryptocurrency activity contribute to government revenues just as traditional financial services firms do.

The high capital requirements for exchanges, while controversial and clearly limiting market entry, reflect a risk-averse approach that prioritizes financial stability and consumer protection over market competition and innovation. Vietnamese regulators appear to have concluded that the risks of exchange failures, hacks, or fraud are serious enough to justify restricting the market to only the most well-capitalized operators. Whether this approach proves optimal remains to be seen—it may successfully prevent the kind of spectacular exchange collapses that have occurred in less regulated markets, or it may stifle competition and innovation while potentially pushing some crypto activity into unregulated offshore platforms. As the five-year pilot program unfolds, regulators will presumably monitor market developments closely and adjust the framework based on actual experience. Vietnam’s cryptocurrency regulatory experiment is being watched closely by other nations, particularly in Southeast Asia, as governments worldwide wrestle with how to approach these transformative but challenging technologies. The coming years will reveal whether Vietnam’s structured, securities-like approach to cryptocurrency regulation can successfully balance the competing demands of innovation, consumer protection, financial stability, and economic opportunity.