Vietnam's vibrant cryptocurrency market, once a leader in adoption, is now reeling from a sharp downturn in digital asset prices. With bitcoin's value nearly halved since its October peak, many investors and startups face significant losses amid regulatory uncertainties. The sector, which attracted 17 million owners, highlights the risks of speculation in a legally gray area.
In Hanoi, 23-year-old Hoang Le, a computer science student, exemplifies the volatility of Vietnam's crypto scene. He began trading from his university dorm, influenced by friends profiting from gaming-related investments. His holdings once reached US$200,000—equivalent to about 50 times the average annual income—but plummeted to zero as bitcoin and other cryptocurrencies crashed in recent months. "Getting wiped out hurt a lot," Le said, viewing the experience as "tuition fees." He reflected, "When profits were high, everyone became greedy... it was too good to be true."
Vietnam, a nation of 100 million with a young, upwardly mobile population, has fostered widespread crypto adoption. An estimated 17 million people own digital assets, placing the country behind only India, the US, and Pakistan according to a Chainalysis Inc report from last year. Unlike China, which banned cryptocurrencies, Vietnam has permitted blockchain development in a legal gray area, prohibiting use for payments but allowing speculation.
The market's enthusiasm has soured into a "crypto winter." Bitcoin's price has almost halved from its record high above US$126,000 in October last year, with other tokens falling further. This has devastated startups offering NFTs, blockchain lending, and trading services, leading to bankruptcies and layoffs. Tran Xuan Tien, head of Ho Chi Minh City's blockchain association, noted, "Many companies have shut down because of this crisis," while others are "downsizing and conserving capital to extend their runway."
Nguyen The Vinh, cofounder of blockchain firm Ninety Eight, reported laying off about one-third of staff since last year, with more restructuring ahead. "The market will likely remain difficult for years, not just months, so we need backup plans," he said. The government has cracked down on scams, including one allegedly defrauding US$400 million from thousands of investors, but avoided fully suppressing the industry.
Under Communist Party General-Secretary To Lam, Vietnam passed a law last year recognizing digital currencies, effective last month, and announced a five-year pilot for crypto trading. However, implementation questions and regulatory ambiguity persist, prompting firms to register in Singapore or Dubai. Huu, 24, a startup founder, said fundraising has become harder as foreign investors, once lured by 400 to 500 percent return promises, now face total loss risks. "Over the past few months, things have gone downhill badly," he added. Nearly 55 percent of individual investors reported losses last year, contributing to a gloomy mood in a market where many trade crypto.
