Vietnam Passes Landmark Law Defining Digital Assets, Boosting AI and Chip Sectors – Decrypt

Vietnam’s National Assembly overwhelmingly approved landmark legislation Saturday, legalizing digital assets and establishing sweeping incentives for semiconductor manufacturing, artificial intelligence development, and digital technology startups.

The Law on Digital Technology Industry passed with 441 votes in favor out of 445 lawmakers present, making Vietnam one of the first countries to comprehensively regulate digital assets through dedicated legislation rather than traditional financial frameworks.

The law, which takes effect January 1, 2026, defines digital assets as products “created, issued, transferred and authenticated using blockchain technology” with clear property rights under civil law.

The move addresses a critical problem that has forced Vietnamese crypto and tech companies to relocate operations to Singapore and other jurisdictions with clearer regulations. 

The new legislation creates three main categories: virtual assets that can be used for exchange or investment purposes, crypto assets that use encryption technology to authenticate assets during creation, issuance, storage, and transfer, and other digital assets, per local media reports.

Both virtual and crypto assets explicitly exclude securities, digital representations of fiat currency, and other financial instruments under existing civil and financial laws.

In March, Prime Minister Pham Minh Chinh had directed the Ministry of Finance and the State Bank of Vietnam to finalize crypto regulation proposals by the end of the month as part of an ambitious 8% economic growth target, but no framework had yet materialized until now.

Vietnam’s crypto adoption has surged despite the legal uncertainty, with blockchain analytics firm Chainalysis ranking the country fifth globally for crypto adoption in 2024. 

Over $105 billion in blockchain market investments flowed into Vietnam during 2023-24, much of it through offshore structures that provided no benefit to the domestic economy.

Beyond crypto regulation, the legislation underscores Vietnam’s ambition to emerge as a regional technology powerhouse. 

The law sets a target of 150,000 digital technology enterprises by 2035, a major expansion from current levels, supported by unprecedented tax incentives and state investment.

Companies developing semiconductors, AI systems, and digital infrastructure can receive corporate income tax rates as low as 10% for 15 years, along with exemptions from import duties and land rental fees. 

Large-scale projects investing over $80 million in data centers or $160 million in semiconductor facilities are eligible for additional “special” incentives, including a five-year personal income tax exemption for foreign experts.

The law targets semiconductor development explicitly, establishing Vietnam’s goal to “gradually become an essential link in the global supply chain.” 

Edited by Sebastian Sinclair