VCI Legal – March 10, 2026

1. Detailed Introduction to the Pilot Project

a. Project Overview

In the context of the rapid global expansion of digital economy models and digital assets, the development of an appropriate legal framework to regulate and effectively leverage emerging technologies has become an urgent priority for many jurisdictions, including Vietnam. Recently, the People’s Committee of Da Nang City authorized the implementation of a controlled pilot program (regulatory sandbox) for a technological solution enabling the conversion of the digital asset USDT (Tether) into Vietnamese Dong (VND) and vice versa.

According to the decision issued by the Da Nang People’s Committee, the technology solution known as MIMO, developed by Dragon Lab Joint Stock Company, operates as an intermediary platform facilitating value conversion between digital assets and fiat currency. A notable feature of this model is its non-custodial architecture, meaning that the system does not directly hold or manage users’ digital assets or fiat funds.

Instead, the platform functions as a technological bridge between blockchain infrastructure and the traditional financial system, enabling users to execute USDT ↔ VND conversion transactions through a predefined technical protocol. This design reduces the risks associated with asset custody by intermediaries, enhances user protection, and supports transactional activities within a controlled regulatory environment during the pilot phase.

The pilot program is expected to be implemented over a three-year period (December 2025 – December 2028) at several locations within Da Nang’s technology ecosystem, including: Software Park No.1 (02 Quang Trung Street); Software Park No.2 (Nhu Nguyet Street); and Da Nang Innovation and Startup Support Center (58 Nguyen Chi Thanh Street). The project is designed to serve multiple user groups, particularly international tourists, foreign experts, and the technology community, who may have legitimate needs to convert digital assets into fiat currency in a lawful and convenient manner while living, working, or attending international events in Da Nang.

b. Project Development Process

In order to obtain approval from the Da Nang People’s Committee for the pilot implementation, Dragon Lab undertook a comprehensive preparation process covering technical infrastructure, legal compliance, and risk governance.

First, the company completed the development of the MIMO technological infrastructure, including an automated conversion system between USDT and VND integrated with international eKYC (electronic Know-Your-Customer) and AML (Anti-Money Laundering) solutions. The platform also incorporates data storage and processing mechanisms designed to comply with Decree No. 13/2023/ND-CP on Personal Data Protection.

In parallel, Dragon Lab prepared a detailed technical and operational dossier demonstrating the platform’s technological capabilities and risk-control mechanisms. The proposal was presented to an inter-agency evaluation council, comprising representatives from relevant government departments and blockchain experts in Da Nang.

The evaluation process involved several rounds of technical and regulatory assessment, focusing on legal compliance, user protection, and financial risk management. Following these reviews, MIMO was recognized as the first solution in Vietnam deemed eligible to operate under a pilot framework with sufficient transparency, safety, and practical applicability in facilitating lawful digital asset conversion.

2. The Regulatory Sandbox Mechanism in Vietnam

From a legal perspective, the decision to allow this pilot model reflects a notable evolution in the policy approach adopted by Vietnamese regulators toward the digital asset sector.

First, the application of the regulatory sandbox as a policy experimentation tool

While a comprehensive legal framework governing digital assets and related services remains under development, the regulatory sandbox mechanism enables authorities to evaluate the real-world performance of innovative technological models within a controlled environment.

This approach has been widely adopted by many jurisdictions in the fintech sector as a means of balancing innovation promotion with systemic risk management.

Second, strengthening compliance and financial risk management mechanisms

Under the announced model, users participating in the system are required to complete electronic identity verification (eKYC) procedures, link their verified bank accounts, and use personal digital asset wallets.

In addition, the system performs blockchain data analytics to examine the origin of transactions and detect abnormal activities. These mechanisms play an important role in supporting Anti-Money Laundering (AML) and Counter-Terrorist Financing (CFT) objectives while ensuring transparency of financial flows within the digital asset environment.

Third, generating empirical data for policymaking

One of the major challenges facing regulators in developing legal frameworks for digital assets is the lack of empirical data regarding how technological business models operate in real markets. The implementation of a regulatory sandbox can provide regulators with valuable insights into user behavior, business models, operational risks. economic impacts of digital asset services. Such information may serve as a critical foundation for the design of future regulatory frameworks governing digital assets in Vietnam.

3. Implications for the Fintech Ecosystem in Vietnam

Da Nang’s proactive initiative in piloting experimental models in the digital asset sector also reflects the city’s strategic efforts to foster an innovation and financial technology (fintech) ecosystem.

With the ambition of becoming a technology and innovation hub in Central Vietnam, the city has been actively exploring new solutions involving blockchain technologies, digital assets, and digital financial platforms.

More broadly, pilot programs of this nature may function as an important transitional mechanism toward the development of a formally regulated digital asset market in Vietnam. If implemented effectively and accompanied by adequate risk management measures, such initiatives could contribute to the emergence of new financial services while enabling regulators to gradually refine the governance framework for digital assets.

In the context of the continued expansion of digital asset markets and their increasing integration with the traditional financial system, policy experimentation initiatives such as this may play a crucial role in shaping Vietnam’s regulatory approach to digital assets in the evolving digital economy.

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