Vietnam is exploring a cashless payment system. According to a report from the English-language daily Viet Nam News, the Vietnamese Prime Minister, Phạm Minh Chính, has asked the country’s Central Bank to study a pilot digital currency.
As a result, Vietnam’s State Bank will be the first bank to explore the practicality and functionality of central Bank Digital currencies (CBDCs) in the country.
The report also states that the State Bank will develop and test a digital currency created on blockchain technology and not a centralized project from 2021 to 2023. This may help to promote cashless payments in the nation.
Vietnam is Looking at Blockchain
Vietnam may want to develop blockchain-based digital currencies as a core technology while other technologies may be used including artificial intelligence (AI), Virtual reality (VR), augmented reality (AR), and big data.
In May 2020, Vietnam’s Ministry of Finance suggested the establishment of a research group to take responsibility for the study and development of policy proposals. The research group consists of the State Bank, the General Department of Vietnam Customs, the Department of Banking and Financial Institutions, etc.
According to Huynh Phuoc Nghia, the deputy director of the Institute of Innovation at the University of Economics Ho Chi Minh City (UEH), the increase in cashless payments in the country may be asking for the State Bank to recognize cryptocurrencies.
Many CBDCs Coming
As Viet Nam News reported, CBDC issuance may be more profitable for smaller countries as they have much to gain from a pivot away from the current major reserve currencies.
In the past, Vietnam not only banned the use of Bitcoin as a means of payment but also gave a directive to credit institutions to closely regulate services given to cryptocurrency-related activities.
There is no reason to think that cryptocurrencies will be widely accepted by Vietnamese companies, however, it looks like there could be changes coming in the near future.
