In aspiring economies, digital currency can provide a practical and trustworthy alternative to the unreliability of national banking systems due to unstable political scenarios. Owing to the widespread penetration of financial technology in the global market, cryptocurrency has received a large-scale acceptance.
According to the crypto adoption index published in 2021 by Chainalysis, Vietnam, India, and Pakistan are among the top three countries. As per the latest cryptocurrency update provided by a shareholder from Holland & Marie, one in five people possesses Bitcoin in Vietnam.
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As reported by Vietnam News, there are no current regulations about managing, trading, exchanging, or issuance, of virtual assets. Experts are of the opinion that postponing the issue of making laws and regulations with respect to cryptocurrencies will lead to a rise in virtual assets robbery and fraudulence. Of late, there have been a lot of investments in cryptocurrencies in Vietnam, namely, Ripple, Pi Network, and Bitcoin.
In April 2020, as per Decision No 664/QD-BTC, the Ministry of Finance created a committee to examine various types of digital assets in order to devise policies regarding their regulation and management. As per Vietnamese economists, central banks all over the world can be placed into three categories. The first group is testing the use of digital currency, the second is planning a pilot study and the third is still examining. Vietnam is making a gradual switch from the third to the second one.
New blockchain union in Vietnam’s Crypto Market
The country turns to a new chapter in the domain of blockchain technology by launching the Vietnam Blockchain Union on May 17 in Hanoi. It has been incepted as per Decision No 343/QD-BNV of the Ministry of Home Affairs. This newly formed body aims to create a pool of avid application users and blockchain researchers from all over the country. This step will further boost the digital revolution of the nation, strengthening its position in the global technological landscape. Some of the objectives of the union are as follows:
- Foster relations with global blockchain organizations and community
- Create viable conditions for members of the body to use blockchain technology according to the Vietnamese law
- Acquiring investment and resources for the functioning of the industry
It is dedicated to developing laws and creating awareness for hassle-free implementation of this technology throughout the country. As this technology makes room for confidential yet transparent data exchange, it has been widely adopted by the finance, retail, and logistics industry. Simultaneously, the government is also encouraging the deployment of this technology for the socio-economic welfare of society.
Blockchain Vietnam: Ownership & usage
There have been several studies conducted on the usage and ownership of cryptocurrencies in the country. As per a study done in November 2021, over 60% of Vietnamese knew about digital currencies. It also showed that a major percentage of the population thought of digital assets as a profitable investment. Moreover, the country had the highest crypto ownership in 2021. On the basis of most searched cryptocurrency, Tron and Bitcoin led by 42%, followed by Ethereum. Even in terms of ownership, the picture is more or less the same. The most sought-after cryptocurrency in the country is Bitcoin with over 27% admitting to owning it. The second-largest number of cryptocurrency buyers was that of Ethereum.
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As per another survey by Statista Global Consumer, over 27% of the local respondents had either owned or used digital currencies in 2021. Around 46% of them wished their desire to use crypto in the near future whereas 13% had already used them in the past. The maximum number of users are youngsters in the age group of 18-34 years, with almost 70% ownership. However, the digital currency ownership amongst the older age group(55 years and above) is only 5%.
Global Successes
Based on Pokemon, Sky Mavis developed Axie Infinity, a virtual game in which you have to train pets also known as Axies. It was incepted to spread awareness about blockchain technology in an entertaining way. These Axies can be used in battles, traded or reared. It is different from standard virtual games as it is designed to use blockchain technology and operates using “play-to-earn’’ principle. Consequently, it has gained a lot of popularity in developing countries like the Philippines, Argentina, and Venezuela. The economic incentive that this game provides in the virtual world is far more than the one in the real world.
The founders have resolved the flaws of Web 2.0 games where the in-game assets were not tradable outside the platform. Even if you do not have an account of Axie Infinity, you could still use blockchain technology to trade.
A rising star in the blockchain industry is the Kyber Network, the third cryptocurrency in the country to have reached USD 1 billion market capitalization. Its worth spiked from USD 1.5 billion to USD 5.5 billion recently. One of its major items is KyberSwap, the largest decentralized transaction with a total value of around USD 7.3 billion, according to VNexpress.