On June 14, 2025, Vietnam’s National Assembly approved the Law on Digital Technology Industry, marking a major change in the country’s approach to digital asset management. Set to take effect on January 1, 2026, the law establishes clear regulations for Vietnam’s rapidly expanding cryptocurrency market. This move is part of a wider effort to enhance the nation’s financial reputation and secure removal from the Financial Action Task Force (FATF) gray list.
Through the new law, Vietnam has established a comprehensive legal framework for digital assets, covering asset classification, licensing procedures, and strict compliance measures in line with global standards. By regulating its cryptocurrency sector, the country seeks to address FATF concerns, enhance investor trust, and strengthen its role as a leading digital economy in Southeast Asia. This reflects a proactive approach by Vietnamese lawmakers in shaping the future of the digital technology industry.
What is FATF
The Financial Action Task Force (FATF) is a global body that sets standards to fight money laundering, terrorist financing, and threats to the financial system. The G7 founded it in 1989. This group includes Canada, France, Germany, Italy, Japan, the UK, and the US.
The FATF creates recommendations to guide national laws. It also checks how well countries follow these rules through peer reviews. If a country fails to meet the standards, the FATF may place it on a “gray list” or “blacklist.” This can damage the country’s financial reputation and reduce foreign investment.
In June 2023, the FATF placed Vietnam on its gray list, officially called “jurisdictions under increased monitoring.” Vietnam agreed to fix major gaps in its Anti-Money Laundering (AML) and Countering the Financing of Terrorism (CFT) systems.
Vietnam Moves Towards Financial Reform with FATF
The FATF highlighted several problems. These included poor oversight of financial institutions, weak Customer Due Diligence (CDD), and limited regulation of virtual asset service providers. The FATF also flagged Vietnam’s lack of action against illicit financing linked to weapons proliferation.
To get off the gray list, Vietnam must carry out an FATF action plan. This requires stronger AML laws, tighter regulatory control, better CDD practices, and effective prosecution of financial crimes.
The FATF tracks progress through regular updates and on-site visits. Once Vietnam shows full compliance, FATF members vote at a plenary session to decide on removal. A successful vote would show renewed confidence in Vietnam’s financial system.
Vietnam’s Law on Digital Technology Industry
In June 2025, Vietnam became the first country to pass a standalone law focused entirely on the digital technology sector. The law will take effect in January 2026 and marks a bold step toward advancing the country’s digital economy.
Here are the key features of the Digital Technology Law:
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Ambitious growth goals: Vietnam plans to build 150,000 digital tech companies by 2035 under the “Make in Vietnam” strategy.
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Clear asset categories: The law distinguishes between crypto assets (like Bitcoin and Ether) and virtual assets (such as non-financial digital items). This separation allows for targeted, risk-based regulation aligned with FATF standards.
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Attractive incentives: Startups, small and medium-sized enterprises (SMEs), and foreign tech investors can benefit from tax breaks, grants, and import duty exemptions.
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Talent support: Vietnamese digital experts get a five-year income tax exemption. Foreign experts receive five-year visas and are exempt from work permit requirements.
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AI and crypto regulation: The law introduces a risk-based framework for artificial intelligence and sets legal standards for managing crypto and virtual assets.
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Regulatory sandbox: Vietnam allows controlled testing of blockchain, decentralized finance (DeFi), and virtual asset innovations to encourage responsible experimentation and growth.
A Closer Look at Vietnam’s Crypto Law
Vietnam’s new law introduces a clear classification of digital assets, dividing them into two main categories:
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Virtual assets: These are non-financial digital items used for exchange or investment. They do not include securities, central bank digital currencies (CBDCs), fiat money, or traditional financial instruments.
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Crypto assets: These are digital assets that rely on encryption or blockchain technology for issuance, transfer, and storage. Like virtual assets, they also exclude securities and CBDCs.
This classification helps create a structured legal framework that allows regulated use of digital assets while separating them from traditional financial products. The law gives the government authority to license, oversee, and issue operating guidelines for each category, aiming for greater transparency and FATF-aligned compliance.
Key changes for crypto startups include:
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Legal recognition: Crypto and blockchain startups now have a formal legal status.
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Regulatory framework: Clear rules govern how these companies can operate.
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Tax incentives: Startups can benefit from tax exemptions and subsidies.
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Pilot programs: The law introduces sandbox mechanisms to test virtual asset products and services in a controlled environment.
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Talent development: Blockchain companies can access workforce training support and incentives.
These changes aim to foster innovation while ensuring responsible growth of Vietnam’s crypto sector.
How Vietnam Addressed FATF Concerns
Vietnam’s Law on the Digital Technology Industry is more than a domestic policy—it’s a key step in aligning the country’s digital asset sector with FATF standards on Anti-Money Laundering (AML) and Countering the Financing of Terrorism (CFT).
Here’s how the law addresses FATF concerns:
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Crypto officially recognized: The 2025 law legalizes crypto ownership and usage, removing legal uncertainty. This move aligns with FATF’s call for clear national regulation of digital assets.
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Clear asset categories: By separating crypto assets (like Bitcoin and Ether) from virtual assets (non-financial digital items), Vietnam enables more targeted, risk-based oversight in line with FATF guidelines.
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AML and CFT enforcement: Crypto exchanges and wallet providers will now operate under government supervision. This helps close gaps in customer due diligence and combats illicit financing.
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Stablecoin regulation: Fiat-backed stablecoins are handled under financial laws, not the digital asset law. This ensures consistent regulation and limits systemic risks, in line with FATF’s risk-based approach.
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Business clarity and control: The law offers clear rules for crypto startups, helping formalize the sector. This improves transaction monitoring, strengthens KYC enforcement, and curbs capital flight.
The law also gives the government authority to set licensing rules, define asset classes, and establish oversight mechanisms. This ensures crypto service providers and financial institutions operate under a structured regulatory system.
Together, these measures show Vietnam’s commitment to FATF standards and its determination to restore global confidence in its financial system.
Vietnam’s Global Image and Future FATF Review
Vietnam’s cryptocurrency law plays a key role in its strategy to meet FATF requirements. By clearly defining virtual and crypto assets and enforcing rules on licensing, AML/KYC, cybersecurity, and transaction monitoring, Vietnam aligns with FATF Recommendation 15—one of the main areas of concern that led to its gray listing.
At the same time, the State Bank of Vietnam has taken steps to tighten AML regulations. Through revised Circular 09, it has updated risk assessments, standardized reporting, and strengthened Customer Due Diligence (CDD). If these reforms are fully in place by January 2026, Vietnam could meet the conditions for removal from the FATF gray list.
A clear and enforceable regulatory framework also builds trust with investors. Legal recognition of crypto exchanges and strong compliance measures attract international crypto firms, venture capital, and tech investors. Improved integration between crypto and traditional banking systems further boosts access to capital markets and institutional funding.
In the long run, Vietnam’s crypto regulation not only responds to FATF concerns—it also positions the country as a transparent, well-regulated, and innovation-driven economy on the global stage.
