Creating a legal framework for Da Nang to become a digital asset center

Photo: Minh Son/Vietnam +

While traditional financial centers in Asia are entering a period of transformation or facing restructuring pressure, in Vietnam, Da Nang is emerging as an attractive and potential destination. This city is expected to become one of the national innovation centers and a new financial center with many pilot mechanisms and outstanding and unique preferential policies.

On June 7, Danang Software Association (DSA) and Binance co-organized Danang Fintech Conference: Unlocking the Future of Digital Assets to discuss important trends of digital assets such as tokenization, blockchain, legal framework and security issues to build a safe, transparent and sustainable digital asset ecosystem.

"Ripe Time" to Become a New Financial Center in the Region

Mr. Le Hoang Phuc - Director of the Center for Research and Training in Microchip Design and Artificial Intelligence in Da Nang said that the international financial center model that Da Nang is aiming for will focus on three core elements: green finance, finance to support cross-border trade, and financial technology (fintech).

The city owns a rapidly growing innovation ecosystem, with more than 6,000 high-quality human resources working in the fields of high technology, AI, blockchain, semiconductors, etc. This is the foundation for developing digital financial services, such as digital banking, decentralized transactions, non-traditional financial services (DeFi), or open finance models.

Mr. Le Hoang Phuc – Director of the Center for Research and Training in Microchip Design and Artificial Intelligence in Da Nang. (Photo: Minh Son/Vietnam+ ).

"A financial center does not only need capital or financial institutions. It needs a comprehensive ecosystem, including people, technology, infrastructure and policies. Da Nang currently has all of those factors," Mr. Phuc affirmed.

In terms of infrastructure, the city has invested heavily in both transport, engineering and technology infrastructure. Tien Sa deep-water seaport, international airport, domestic and international logistics system, plus increasingly improved digital infrastructure all help Da Nang be ready to welcome global capital flows.

In terms of human resources, Da Nang has more than 25,000 students graduating from universities each year, including thousands of students majoring in high technology. This is a young, well-trained workforce with the ability to quickly adapt to new technology trends from big data, AI to blockchain, which is the foundation for developing a financial center with a technological identity.

In terms of policy, Da Nang is one of the localities that the Central Government has "chosen" to pilot special and outstanding policies on taxes, land, investment incentives, etc. to attract high-quality capital flows and global financial technology corporations.

The human factor cannot be ignored. According to Mr. Phuc, the current leadership team of Da Nang has the vision, determination and capacity to act in accordance with the requirements of the new period. According to Mr. Phuc, this is the 'ripe time' to help turn 'plans on paper' into reality.

Da Nang has been known for many years as the most "livable" city in Vietnam. But with a change in development strategy, this place is also becoming a "city worth investing in", especially in the field of finance and technology.

Startups in the fields of fintech, blockchain, digital banking or financial AI are looking to Da Nang as a new land where there is not only good infrastructure, young human resources, but also an open spirit and support for innovation from the government.

Mr. Le Hoang Phuc also emphasized: "The miracle of the Han River in Da Nang will inspire the formation of an international financial center and Sandboxes that meet international standards for the sustainable development of digital assets."

The challenge of creating a legal framework in digital assets

At the Conference, Mr. Le Son Phong - Deputy Director of the Department of Science and Technology of Da Nang City said that the city is gradually shaping its role as a creator for the sustainable development of the innovation ecosystem, including the fields of blockchain and digital assets. With advantages in mechanisms, resources and an open ecosystem, the city will implement the Sandbox mechanism (Controlled Experimentation) for breakthrough technology initiatives, along with piloting flexible policy models that are suitable for innovation practices.

Mr. Phong emphasized that technology cannot develop in an environment lacking trust, appropriate institutions, and innovation motivation. The city is committed to working with the community, businesses, and investors to design an open policy space that is favorable for development.

Mr. Le Son Phong - Deputy Director of the Department of Science and Technology of Da Nang City. (Photo: Minh Son/Vietnam+ ).

Meanwhile, Mr. Vo Duc Anh - Deputy Director of the Danang Center for Supporting Innovation and Startups, one of the foundational documents for the opportunity to develop digital assets in Vietnam is the "National Strategy on Application and Development of Blockchain Technology to 2025, with a Vision to 2030" issued by the government in October 2024. Along with the draft law on digital technology , digital assets under discussion will open up a legal corridor and management of digital assets.

Mr. Duc Anh said that Resolution 136 of the National Assembly on the organization of urban government and piloting a number of specific mechanisms and policies for the development of Da Nang city also allows the city to operate the Sandbox mechanism for new technology fields, including blockchain and digital assets. These are considered important premises for Da Nang to become a digital asset center, not only in Vietnam but also on an international scale.

From a business perspective, Ms. Lynn Hoang - Binance Country Director commented: "The first plus point is that Vietnam has decided to pilot digital assets. This is an important premise showing that Vietnam is ready to join the world in this new and potential field. However, from the draft to the issuance of specific legal documents, there is still a long way to go. If the legal framework is created, Vietnam will gain many important advantages. On the contrary, we may lose opportunities. Hopefully, our policies will not be too different from the world and will create development for the entire industry while still ensuring safety in management."

From practical research, Associate Professor, Dr. Binh Nguyen of RMIT University Vietnam, said that issuing a clear legal framework for digital assets is a huge challenge, not only for Vietnam but also for developed countries such as the US, Singapore, and Sweden, which are still looking for ways to balance development and risks for businesses.

"For Vietnam, we cannot control everything at once, but must select the most important areas to research and promulgate laws, then expand to the entire industry," Dr. Binh commented. According to him, Vietnam can prioritize the legal framework for buying and selling digital assets, then clearly distinguish between types of assets to avoid risks.

According to experts, the biggest challenge in issuing a suitable legal framework for digital assets is that regions and countries must, depending on actual conditions, balance factors related to attracting foreign investment; legalization needs to be in harmony with international practices; stimulate user participation; especially domestic companies are not "left behind".

Meanwhile, safety must be a top priority. International standards on KYC (know your customer) and AML (anti-money laundering) cannot be ignored.

Binance representative said that in order for Da Nang to attract more international capital, the authorities should accompany businesses when providing legal corridors. Da Nang can study and learn from the UAE model of digital asset management. In just 1 year from 2022 to 2023, the UAE has attracted billions of dollars more. Up to now, the number of businesses in this field moving to Dubai is increasing.

"Compared to Dubai, Da Nang city is much more livable with its favorable natural conditions. If there are constructive policies, the heart of the Central region can become the new capital of digital assets in the whole region, not just Vietnam," said Ms. Lynn Hoang - Binance Country Director./.

Source: https://znews.vn/kien-tao-khung-phap-ly-de-da-nang-tro-thanh-trung-tam-tai-san-so-post1559204.html