Vietnam, the next Web3 paradise?

Author: Yuan Shan Dong Jian

• In late January, the Ministry of Finance officially launched the pilot work for licensing crypto asset trading platforms.

• The 10 trillion VND (nearly 300 million RMB) entry threshold directly filters out small and medium players, with domestic financial giants entering the market.

• Establishing a new geopolitical division of labor: “Dubai compliance, Vietnam development,” aiming to become the “core OEM factory” of the Web3 world.

The Davos Forum just concluded, and BlackRock CEO declared that “the financial system should migrate to Ethereum,” while the NYSE announced the development of a tokenized securities platform.

Meanwhile, Vietnam’s Ministry of Finance has launched the crypto license pilot, with a 10 trillion VND (nearly 300 million RMB) entry threshold, directly blocking small exchanges.

Traditional finance embraces Web3, and emerging markets in Southeast Asia are setting compliance thresholds. Will they become the next Hong Kong or the next Singapore?

【 01 ｜ What happened 】

In late January, Vietnam’s Ministry of Finance officially launched the pilot work for licensing crypto asset trading platforms. This marks Vietnam’s shift from the “gray area” to clear regulation.

There are three key points:

Entry threshold: Paid-in capital must reach 10 trillion VND (nearly 300 million RMB). Compared to this, the threshold of 100 million PHP (about $1.8 million) in the Philippines is more than 16 times lower.

Applicant restrictions: Must be a Vietnamese domestic enterprise. This means Binance, Coinbase, etc., cannot directly obtain licenses and must enter through local joint ventures or acquisitions.

The first institutions to express participation include SSI Securities (a leading Vietnamese securities firm) and MB Bank (a major commercial bank), both traditional financial institutions.

Timeline: This move occurred less than a week after the Davos Forum this year.

During the forum, signals of global regulatory competition were already evident—Japan announced the legalization of crypto ETFs by 2028, the UK Financial Conduct Authority (FCA) is close to completing crypto regulation consultations, and the US Congress is pushing forward with “crypto market structure legislation.”

Vietnam’s move is a response to this global competition. This is also the current publicly known fact.

【 02 ｜ From gray profits to scaled sunshine 】

Vietnam’s previous crypto market was in a “gray area”—neither clearly legal nor fully prohibited. Under this ambiguous state, many small exchanges grew wildly without licenses or regulation. User funds lacked protection, and exit scams occurred frequently.

The licensing system aims to shift the crypto market from “gray profits” to “scaled under the sun.” The nearly 3 billion RMB threshold blocks underfunded small exchanges but opens space for capable local financial institutions.

The entry of traditional institutions like SSI Securities and MB Bank means that asset custody, compliance, and anti-money laundering will be conducted according to traditional financial standards.

The Philippines experience offers a comparison: from late 2025 to early 2026, the Philippines’ National Telecommunications Commission (NTC), following central bank instructions, blocked nearly 50 unlicensed platforms including Coinbase and Gemini. However, local licensed exchange PDAX experienced explosive growth in trading volume. Compliance did not end the market but redistributed the cake.

Vietnam is not the first to act. Looking at Southeast Asia, Thailand, Malaysia, and the Philippines completed regulatory framework upgrades between 2025 and 2026.

– Thailand released official guidelines in early 2026 supporting the establishment of spot Bitcoin and Ethereum ETFs and incorporating crypto assets into the Derivatives Act framework. To attract institutional investors, Thailand’s Ministry of Finance approved a capital gains tax exemption policy that will last until December 2029.

– Malaysia adopted a “dual management” model: the Securities Commission (SC) classifies investment-related cryptocurrencies as “securities,” while the Central Bank of Malaysia (BNM) monitors anti-money laundering. Currently, six licensed exchanges are authorized to operate, and the SC adopts a “zero tolerance” attitude toward unlicensed platforms.

– The Philippines raised the entry threshold: according to the SEC’s “Crypto Asset Service Provider Rules” issued in 2025, all platforms operating in the Philippines must register as local companies, with paid-in capital not less than 100 million PHP (about $1.8 million).

Vietnam’s move is a follow-up in this Southeast Asian regulatory race and part of a regional trend. When neighboring countries are establishing compliance frameworks, Vietnam continuing to maintain a gray area risks losing the opportunity to attract legitimate institutions.

An often overlooked background is that Web3 enterprises’ global deployment is forming a new geopolitical division of labor: Dubai (compliance center) + Vietnam/Malaysia/Thailand (development centers) + global markets (operation coverage).

Dubai, through establishing the world’s first dedicated regulatory authority VARA, has become the preferred location for Web3 startups to register and comply. But Dubai has high talent costs and significant expenses for technological development and ecosystem building.

Vietnam, Malaysia, Thailand, and other Southeast Asian countries, with low talent costs and local policy support, are becoming “development centers.” Vietnam’s launch of the licensing system signifies a shift from “gray development” to “compliant development”—companies can legally establish technical teams and develop DApps and infrastructure in Vietnam without worrying about sudden policy changes.

This geopolitical division of labor is a great boon for the Web3 industry. Companies can place compliance in Dubai, development in Vietnam, and market coverage globally. This “traffic-for-resources” logic is more sustainable than simply being non-compliant everywhere.

【 03 ｜ Why it might also bring risks 】

• Raising the entry threshold may increase industry concentration

Nearly 3 billion RMB in paid-in capital is not high for traditional financial institutions, but for native crypto startups, it is a difficult barrier. This could lead to Vietnam’s crypto market being monopolized by traditional financial institutions, lacking innovation vitality.

The Singapore experience offers a comparison: the Monetary Authority of Singapore (MAS) has a very lengthy review process for crypto exchange licenses, focusing on anti-money laundering and technical risk management. As a result, many innovative startups could not obtain licenses and eventually left Singapore. While Singapore’s regulatory framework is mature, it has also lost some innovative companies.

Will Vietnam follow the same path? If traditional institutions like SSI Securities and MB Bank dominate, do they have enough motivation to promote emerging businesses? Or will they treat crypto trading as “another financial product” to operate, lacking understanding of Web3 native culture?

• Compliance costs may be passed on to users

The licensing system brings compliance costs—KYC procedures, custody fees, regulatory reporting—that may ultimately be borne by users. If licensed exchanges in Vietnam charge significantly higher trading fees than international platforms, users might turn to underground markets or use VPNs to access overseas exchanges.

The goal of compliance is to protect users, but excessive costs could push users toward less secure channels.

• Mismatch between regulatory capacity and market innovation

Vietnam’s crypto market is still in early stages. Do regulators have enough technical ability and talent reserves to oversee complex DeFi protocols, cross-chain transactions, and stablecoin issuance?

The reality is that SSI Securities and MB Bank are proficient in traditional finance but may lack experience in on-chain governance, smart contract security, liquidity mining, and other Web3 native activities. If regulators also lack expertise in these areas, the license system could become a “formal compliance” measure—superficial regulation without real risk detection.

Another point is geopolitical uncertainty:

Vietnam’s crypto market mainly covers Southeast Asia, but the region’s geopolitical situation is complex. US influence in Southeast Asia, China-ASEAN relations, Vietnam’s regulatory coordination with neighboring countries—these factors could affect policy stability.

If Vietnam’s licensing system is incompatible with neighboring countries like Thailand and Malaysia, cross-border business compliance could become more difficult. Can Web3 companies’ products developed in Vietnam operate smoothly in Thailand and the Philippines? If not, Vietnam’s role as a “development center” will be significantly diminished.

【 04 ｜ Hong Kong vs Singapore: Vietnam’s choice 】

Vietnam’s nearly 300 million threshold and domestic institution priority policy send a clear signal: it does not want to be the next Philippines (low threshold, high activity), but is choosing between Hong Kong and Singapore.

Hong Kong’s path is “retail-friendly + financial product innovation”: allowing retail trading, approving spot ETFs, and establishing a stablecoin sandbox. This open stance attracts a large amount of Asian capital but also entails higher regulatory costs and risks.

Singapore’s path is “institution-friendly + strict retail control”: MAS discourages retail speculative trading but actively promotes blockchain applications in wholesale settlement and asset securitization (e.g., Project Guardian). The entry threshold is very high, but the ecosystem is more stable.

Vietnam’s nearly 300 million threshold and domestic institution priority policy resemble Singapore’s approach. But the question is whether Vietnam’s financial infrastructure and talent reserves can support “institution-level high standards” regulation.

If Vietnam aims to become the “Singapore of Southeast Asia,” it needs not only a licensing system but also a complete legal framework, professional regulatory team, and deep alignment with international standards. These require time and resource investment.

For Vietnam, the Hong Kong path means quickly gathering liquidity, attracting retail funds, and building an Southeast Asian crypto trading hub. But the question is whether Vietnam’s regulators have enough expertise to handle retail market complexities. If retail funds face risks, can Vietnam provide a comprehensive complaint mechanism like Hong Kong?

The third path: “Development center + remote compliance”

Perhaps Vietnam does not need to become Hong Kong or Singapore. It can take the third route: become a Web3 development hub, with compliance managed by Dubai, Hong Kong, or Singapore.

This geopolitical division of labor is taking shape: Dubai (compliance center) + Vietnam/Malaysia/Thailand (development centers) + global markets (operation coverage).

This approach is more realistic. Vietnam does not need to compete with Hong Kong or Singapore for the compliance center role but can leverage talent costs and policy support to become an industry-recognized “development hotbed.”

【 05 ｜ Retail impact: compliance is not the end 】

The most direct impact of the licensing system is on ordinary Vietnamese crypto users. In the past, they could freely choose international exchanges or small local platforms, with low fees and low barriers, but at their own risk.

Now, if Vietnam strictly enforces the licensing system, unlicensed platforms may be blocked (as in the Philippines). Users will only be able to choose licensed exchanges operated by SSI Securities or MB Bank.

Advantages: user funds are protected through custody, KYC procedures are standardized, and there are channels for complaints.

Disadvantages: trading fees may rise, the variety of supported tokens may decrease (regulators usually only approve mainstream coins), and product innovation may slow down.

For Vietnam’s young retail investors—who are accustomed to using platforms like Binance—this shift may cause discomfort. If local licensed exchanges cannot provide the same user experience, some users may turn to VPNs or P2P over-the-counter trading, creating new regulatory blind spots.

Regulators aim to protect users, but overly rigid enforcement could push users toward less secure channels. Vietnam needs to balance “protecting users” and “maintaining market vitality.”

【 06 ｜ Maybe the third path is more realistic 】

Hong Kong’s path attracts retail and liquidity but requires very strong regulation. Singapore’s path is stable but has very high thresholds, requiring mature financial infrastructure. Vietnam lacks both.

But the third path is more feasible: becoming a Web3 development center, leveraging talent costs and policy support, with compliance managed in Dubai or Hong Kong. The nearly 300 million threshold signifies a shift from “gray area” to “compliant development”—companies can legally establish teams and develop products without fearing sudden policy changes.

This is the first time Vietnam has regulated “crypto asset trading platforms” as a formal financial industry.