Vietnamese PM Calls on State Bank For CBDC Pilot

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In Brief
  • Vietnamese Prime Minister Pham Minh Chinh has called on the State Bank of Vietnam (SBV) to carry out a pilot project for a digital currency (CBDC).

  • Cryptocurrencies utilizing blockchain technology are one of the core technologies Vietnam hopes to master.

  • Although authorities are skeptical about cryptocurrencies, they seem enthusiastic about the potential of blockchain technology.

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Vietnamese Prime Minister Pham Minh Chinh has called on the State Bank of Vietnam (SBV) to carry out a pilot project for a digital currency (CBDC). 

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The study to issue a digital currency utilizing blockchain technology is expected to take place between 2021-2023. The prime minister highlighted this in his decision about e-Government development strategy towards a digital government. 

Cryptocurrencies based on blockchain technology are simply one among several core technologies Vietnam hopes to develop and master. Others include artificial intelligence (AI), big data, augmented reality and virtual reality (AR/VR). The prime minister said these could create significant breakthroughs, providing favorable conditions for building a digital government. 

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Crypto in Vietnam

There have been conflicting definitions of cryptocurrencies and virtual assets in Vietnam. However, so far, there seems to be a general consensus from authorities. For many years, the SBV stressed that cryptocurrencies, including Bitcoin, have not legally been recognized in Vietnam. The use of cryptocurrencies as a means of payment is also not legally recognized and protected. Finally, the central bank has not granted licenses for any cryptocurrency trading platforms to date.

Despite this skepticism at the governmental level, authorities are still intrigued by the potential of digital assets established on a blockchain. Last year, the Ministry of Finance set up a group to study virtual assets and cryptocurrencies, then to propose policies and management mechanisms.

Huynh Phuoc Nghia, deputy director of the Institute of Innovation under the University of Economics, Ho Chi Minh City, says that “digital money is an inevitable trend.” According to him, it’s time for the government to study and carry out pilot implementation for cryptocurrency. 

Blockchain buffs

Although somewhat skeptical about cryptocurrencies, Vietnamese authorities have already found a way to benefit from blockchain technology. Last year, the Ministry of Education and Training of Vietnam uploaded its high school and university diplomas onto a blockchain.

The Vietnamese government is calling for further use of blockchain, including its electronic identification (eKYC) system, though details are not yet forthcoming. If it continues at this pace, Vietnam could overtake Malta in the educational blockchain space.

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Nick is a data scientist who teaches economics and communication in Budapest, Hungary, where he received a BA in Political Science and Economics and an MSc in Business Analytics from CEU. He has been writing about cryptocurrency and blockchain technology since 2018, and is intrigued by its potential economic and political usage. He can best be described as an optimistic center-left skeptic.

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