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Vietnam Tightens Grip on Blockchain Anti-Money Laundering
As the country remains on the Financial Action Task Force’s (FATF) gray list, Vietnam’s financial authorities are stepping up efforts to prevent money laundering in the cryptocurrency sector.
New Challenges for Authorities
The increasing use of digital currencies has created new challenges for authorities in detecting and preventing money laundering activities. The country’s lack of a specific legal framework and limited human resources in managing and controlling cryptocurrencies have exacerbated the problem, experts warned at a recent conference organized by the Vietnam Banks Association and the Vietnam Blockchain Association.
Data Reveals Illicit Activities
According to data from Chainalysis, Vietnam received a total value of $2 billion worth of cryptocurrencies between October 2023 and October 2021. Unfortunately, illegal activities accounted for $10 million of this amount. The most popular platform for trading cryptocurrencies among Vietnamese users is Binance.com, which had nearly 42 million visits from within one year.
Recommendations for Financial Institutions
To enhance the effectiveness of anti-money laundering activities, financial institutions need to:
- Identify digital asset transactions
- Build processes and prepare high-quality human resources
- Develop compliance processes and controls for anti-money laundering activities involving digital assets
- Prepare well-trained staff who can fully converge economics, technology, and law
FATF Urges Vietnam to Take Action
The Financial Action Task Force (FATF) has urged Vietnam to work towards ensuring the independence of agencies responsible for investigating financial crimes, managing digital assets, and strengthening international cooperation against money laundering. The country’s inclusion on the gray list underscores the need for urgent action to address these issues.
Growing Importance of Preventing Money Laundering
As the cryptocurrency market continues to grow, with estimated global value reaching $16 trillion by 2030, Vietnam’s authorities must take decisive steps to prevent money laundering activities and ensure the integrity of the financial system.