On June 14, 2025, Vietnam’s National Assembly passed the Law on Digital Technology Industry, signaling a significant shift in how the country manages digital assets. Effective Jan. 1, 2026, this law introduces clear regulations for Vietnam’s fast-growing cryptocurrency sector. It represents a broader attempt by Vietnam to improve its financial reputation and exit the Financial Action Task Force (FATF) gray list. 

With this law, Vietnam has implemented a comprehensive legal framework for digital assets. This includes classifying digital assets, licensing requirements and robust compliance mechanisms aligned with international standards. By regulating its crypto sector, Vietnam aims to address FATF concerns, boost investor confidence and position itself as a digital economy hub in Southeast Asia. 

This article explores how crypto reform supports Vietnam’s FATF comeback strategy. It digs into Vietnamese crypto law and explains how it addresses the FATF’s concerns.

Founded in 1989 by the G7, or the Group of Seven, the FATF is a global organization that establishes standards to prevent money laundering, terrorist financing and other threats to the financial system. The FATF creates policies and oversees their adoption in member countries. The G7 is an intergovernmental organization comprising seven leading advanced economies: Canada, France, Germany, Italy, Japan, the UK and the US. 

The FATF provides recommendations to shape national laws and assesses compliance through peer reviews. Countries that do not meet FATF standards may be placed on a “gray list” or “blacklist,” which can harm their global financial reputation and investment environment.

By complying with FATF rules, Vietnam hopes to attract global VCs and crypto exchanges, turning regulatory clarity into an economic development tool. 

In June 2023, Vietnam was placed on the FATF gray list, officially termed “jurisdictions under increased monitoring,” after agreeing to address significant deficiencies in its Anti-Money Laundering (AML) and Countering the Financing of Terrorism (CFT) measures. 

The FATF cited issues such as inadequate supervision of financial institutions, weak Customer Due Diligence (CDD) and insufficient regulation of virtual asset service providers. It also raised concerns about Vietnam’s efforts to combat illicit financing tied to weapons proliferation. 

To be removed from the gray list, Vietnam must fully implement an FATF action plan. This includes strengthening AML laws, improving regulatory oversight, enhancing CDD and ensuring effective prosecution of financial crimes. 

The FATF monitors progress through updates and on-site visits. Once compliance is demonstrated, member states vote in a plenary session to decide on removal, signaling renewed trust in the country’s financial integrity. 

Vietnam became the world’s first country to pass a standalone law dedicated to the digital technology industry. The law was passed in June 2025; implementation begins in January 2026.

Here are the key highlights of Vietnam’s Law on Digital Technology Industry (Digital Technology Law):

The law divides digital assets into two categories: 

This classification of digital assets facilitates a structured legal framework that enables regulated use of these assets while differentiating these categories from mainstream financial products. It tasks the government with licensing, oversight and operational guidelines for each category, signaling a move toward transparency and compliance.

The law excludes securities, CBDCs, and traditional financial instruments from these categories.

Key changes for crypto startups include legal recognition, a framework for regulation and tax incentives. The law also includes provisions for pilot sandbox mechanisms for virtual asset products and services. Tax exemptions, subsidies and workforce training programs are available for blockchain startups.

Vietnam’s crypto law allows authorities to collaborate internationally on digital asset fraud, improving cross-border investigations and curbing global crypto crime.

More than just a domestic milestone, Vietnam’s Law on the Digital Technology Industry represents a critical step toward aligning Vietnam’s digital asset sector with FATF standards on AML and Countering the Financing of Terrorism.

These reforms directly support Vietnam’s goal of exiting the FATF gray list by establishing a transparent, controlled crypto environment that is compliant with global standards.

The legislation also empowers the government to define licensing rules, asset classification and oversight mechanisms, ensuring crypto service providers and financial institutions operate within a regulated environment. 

Through these measures, Vietnam signals its commitment to meeting FATF standards and regaining international trust in its financial ecosystem. 

The law provides Vietnamese authorities with a clear legal framework to investigate, prosecute and deter digital asset fraud. Previously, the absence of legal tools hampered enforcement efforts. The law introduces compliance obligations such as identity checks, transaction monitoring and reporting duties. 

Two recent fraud cases highlight the urgency of these reforms: 

The law passed by Vietnam’s National Assembly includes AML and CFT measures, requiring crypto service providers to implement compliance procedures such as identity checks, transaction monitoring and reporting obligations.

Provisions of the law facilitate greater cooperation with international regulators. Vietnam facilitates collaboration with foreign authorities on cross-border investigations by aligning its crypto regulations with global standards. 

This law is particularly important for addressing transnational crypto crimes, where assets and suspects often cross jurisdictions. By addressing legal gaps and enhancing regulatory coordination, Vietnam has bolstered its national enforcement efforts and reputation in the global financial community.

Being on the FATF gray list doesn’t just hurt reputation; it can make foreign banks hesitant to work with domestic institutions, limiting capital flow and investments.

Vietnam’s new crypto law is part of its ambition to become a digital technology hub in Southeast Asia. By formally recognizing crypto assets, the government welcomes innovation and attracts global startups and investors. 

The law offers significant incentives for tech companies, including: 

• Grants and infrastructure support for R&D in semiconductors and cloud technology. 

To support this ecosystem, the government is also investing in digital education through vocational programs, university-industry collaboration and tech apprenticeships, ensuring a skilled workforce for the future. 

These combined efforts aim to establish Vietnam as a regional leader in digital innovation. 

Vietnam’s cryptocurrency law is central to its FATF compliance strategy. By defining virtual and crypto assets and enforcing rules on licensing, AML/KYC, cybersecurity and transaction oversight, the country has aligned itself with FATF Recommendation 15, one of the key issues cited during its gray listing. 

In parallel, the State Bank of Vietnam has tightened AML rules, updated risk assessments, standardized reporting practices, and strengthened CDD under revised Circular 09. If fully implemented by January 2026, these reforms could pave the way for Vietnam’s removal from the gray list. 

A clear regulatory environment also enhances investor confidence. Legalized exchange operations and strong compliance standards reassure international crypto businesses, venture capitalists and tech firms. Moreover, seamless integration between crypto and traditional banking improves access to capital markets and institutional finance. 

Ultimately, Vietnam’s crypto regulation not only addresses FATF concerns but also enhances its global image as a transparent and innovation-friendly economy.