VBA seeks collaboration to establish legal framework for virtual assets

The Vietnam Blockchain Association (VBA) today hosted a workshop to gather feedback and build a legal framework for managing virtual assets (VAs) and virtual asset service providers (VASPs).

Standing Vice Chairman of VBA Phan Duc Trung stated that the introduction of a legal framework to manage Vas will ensure customers’ rights

In Vietnam, due to a lack of a complete legal framework while regulations related to VA-VASP are scattering in 19 different legal documents, frauds in the marketing and promotion of VA services are often disguised under various forms, including closed seminars to attract capital from individual investors.

The Vietnam Blockchain Association (VBA) has received many reports from users about being scammed by sending or depositing money on trading platforms and e-wallets that have not been verified by the management agency.

Standing Vice Chairman of VBA Phan Duc Trung stated that it is high time the community joined hand to establish a set of ethical standards, project standards, and to apply on-chain traceability RegTech technology, which can contribute to minimizing fraud and scams related to VAs.

Other useful tools include AI, Machine learning, BigData, Blockchain in order to optimize the process of organizations' compliance with legal regulations, increasing the accuracy and transparency of financial reports.

“To form a legal framework to control VA-VASP needs a combination among practical experience, the use of state-of-the-art technologies, and the financial industry’s risk principles such as Know Your Customer (KYC), Know Your Business (KYB), Know Your Investor (KYI), and Know Your Transaction (KYT). This will ensure customers’ rights, the sustainability of the system, and more innovation”, said the Vice Chairman.

Experts in the field are discussing measures to create a legal framework to manage VAs

In reality, many VASPs operating in Vietnam without a permit are currently showing signs of violating the law, typically illegally collecting personal data and using user's personal data for improper purposes. In addition, the exchange of assets, especially financial and real estate transactions such as buying and selling stablecoins, mining coins, selling application tokens in GameFi, selling NFTs leads to the risk of violating tax and anti-money laundering regulations.

General Secretary Do Ngoc Quynh of the Vietnam Bond Market shared that VAs and ancillary activities exist on a large scale in Vietnam and globally. VAs can also be considered one of the innovative applications of advanced technology in the process of social development, aiming to better meet human needs.

Since creative ideas often precede the development of the legal framework and always bring both positive and negative impacts to society, it is necessary to establish a legal framework to protect consumers, to maximize the strengths of advanced technologies for society development while minimize negative effects at the same time.

Statistics from the Atlantic Council (AC) reveal that an increasing number of nations are paying attention to suitable and effective legal frameworks to manage Vas. Until December 2023, 32/60 countries formally legalized crypto assets. Notably, 10 countries in the G20 (accounting for 50 percent of global GDP) have officially issued regulations related to the management of VAs and VASPs.

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