Pham Minh Chinh, the Prime Minister of Vietnam, has requested the State Bank of Vietnam (SBV) to investigate and pilot the use of a national digital currency from 2021 to 2023.
This is in order to improve its cashless payment system by establishing a digital government.
Prime Minister Pham Minh Chinh signed “Decision No 942/QD-TTg” as part of the approval of the e-government growth strategy, according to Vietnamese news reports. The government is doubling down on artificial intelligence, augmented reality, virtual reality, big data, and blockchain technology, according to reports.
The Prime Minister has urged the State Bank of Vietnam (SBV) to study and pilot the adoption of national digital money from 2021 to 2023 in order to improve cashless payment and the development of a digital government. According to some reports, the country is working on a central bank digital currency (CBDC). Several sources say, however, that the announcement refers to it as a cryptocurrency.
By “Decision No 942/QD-TTg” on April 24, 2020, the Ministry of Finance assigned a group to research virtual assets and cryptocurrencies in depth and recommend policies and management systems.
Huynh Phuoc Nghia, deputy director of the Institute of Innovation at the University of Economics in HCM City, emphasized that it is time for the government to make this decision in order to thoroughly comprehend the benefits and drawbacks of the primary implementation.
The pilot implementation would aid the government in identifying positive and bad features, as well as building a better management structure. While cashless payments are becoming more common in Vietnam, the central bank’s recognition of digital currencies will help speed up the process.
Vietnam is taking cues from the CBDC implementations in neighboring nations.
International currencies such as the US dollar, yen, and euro, according to Nghia, have unquestionably had a significant impact on international trade and the world currency basket. Things have changed, however, as the financial industry has evolved, and the competition to develop and implement new technology has given countries like Vietnam a chance to influence the global financial system.
Over the last few years, the SBV has emphasized its stance on cryptocurrency, arguing that it is not a legal tender. Due to its role in money laundering, tax evasion, and terrorism financing, it went above and beyond in banning banks and payment service providers from processing crypto transactions in 2018.
According to Le Dat Chi, deputy head of the university’s Finance Faculty, cryptocurrency growth must be accelerated in order to keep up with the growing financial system. Vietnam is seen to be adopting cues from its geographical surrounds, as China is nearing the end of its digital yuan pilot program. Cambodia, on the other hand, is working on Project Bakong, a CBDC system. Thailand’s Project Inthanon has likewise been the subject of intense inquiry. A provider was recently hired by the government to develop a CBDC prototype.
CBDC Vietnam is a non-profit organization that promotes/n
