Vietnam can collect large cash flows from taxing Bitcoin and virtual assets

Many important figures have been shown about the development of Vietnam’s digital asset market. According to Chainalysis, Vietnam currently ranks top 3 globally in the cryptocurrency adoption index. Notably, the flow of cryptocurrency and virtual assets flowing into Vietnam in the period from July 2022 to July 2023 is 120 billion USD, an increase of 20% compared to the figure of 100 billion USD in the period 2021-2023. 2022.

Chainalysis also estimates the total profit of global crypto asset investors to be 37.6 billion USD in 2023, of which Vietnam currently ranks third with about 1.2 billion USD in profit.

The majority (about 60%) of cryptocurrencies in Vietnam are currently traded on centralized exchanges (CEX). According to Triple A data, up to 20% of the Vietnamese population owns virtual assets. The number of people owning virtual assets in Vietnam even ranks third globally if calculated by absolute number.

Should Vietnam collect virtual property tax?

At the recently organized Blockchain & AI forum, Mr. Phan Duc Trung, Permanent Vice President of Vietnam Blockchain Association, said that Triple A data shows that up to 85% of people work as freelancers. ) in Vietnam owns virtual assets due to the characteristics of global jobs. Even 35% of them accept payment in virtual assets even though this violates regulations.

With this reality, Vice President of Vietnam Blockchain Association said that Blockchain is like an underground economy of the GenZ generation (those born after 1997) and “freelance” workers.

The flow of money circulating in the virtual economy is very large. If we ban or avoid introducing management regulations for Blockchain and virtual assets, we will waste the opportunity. In that context, Vietnam needs to soon develop a virtual asset management policy to gradually convert the underground economy from virtual assets to public ones, thereby contributing to promoting economic growth.

“Who knows, maybe in the future we will receive tax streams from virtual assets, just like tax streams from stock transactions”, Vice Chairman of Vietnam Blockchain Association raised the issue.

Virtual asset management will help Vietnamese startups not have to go abroad

According to a December 2023 survey by the Atlantic Council of 60 countries around the world, there are currently 32 countries that recognize virtual assets as legal, 19 countries that partially ban and 8 countries that completely ban virtual assets. It is noteworthy that 10 countries in the G20 group have now legalized this type of asset.

According to Attorney Tran Quoc Bao of Pantheon law firm, because it is a new issue, 70% of countries in the world do not have a legal framework to manage virtual assets and virtual asset trading floors. In the region, Thailand and Singapore are very open to this field, while Vietnam currently does not have a legal framework on virtual assets.

“Many startups in the field of virtual assets and virtual asset exchanges are wondering whether they can develop their businesses domestically, or must they go abroad? Vietnam should consider applying legal policies to help Vietnamese Blockchain businesses operate legally in Vietnam, thereby contributing and promoting social development.”, Lawyer Tran Quoc Bao stated his perspective.

Should virtual assets, Bitcoin, and cryptocurrency exchanges be banned or regulated?Recognizing, banning or regulating virtual assets will all cause conflicts of interest between traditional investors and those pursuing digital business models.