The initiative, announced by the Da Nang Department of Science and Technology, aims to create a controlled testing environment, or sandbox, for innovative financial technologies.

The proposal comes at a time when the city is exploring various technological models to enhance its economic framework.

At the Da Nang Fintech Summit on June 7, Deputy Director Vo Duc Anh said that the local government is evaluating multiple controlled experiments from technology start-ups.

The use of USDT, a stable coin pegged to the US dollar at a 1:1 ratio, is seen as an essential step in integrating cryptocurrency into everyday commerce.

Under the proposed model, international visitors would use digital wallets to make payments via QR codes in USDT, while local businesses would still receive payments in dong.

This transaction process would be facilitated through an intermediary system, ensuring that all exchanges are smooth and compliant with existing regulations.

Despite the potential benefits, regulatory bodies in Vietnam have consistently stated that cryptocurrencies are not recognised as legal tender.

However, the Da Nang Fintech Summit highlighted a shift in perspective.

Anh referenced Resolution 136 from 2024, which grants Da Nang the authority to implement controlled testing mechanisms for new technologies, similar to a speed limit allowing for temporary exceptions in certain scenarios.

The local government has formalised the sandbox policy through resolutions at the People's Council level. Anh explained that applications for sandbox mechanisms are handled like administrative procedures, ensuring clarity and efficiency, with processing times estimated at around 2.5 months.

Industry experts are optimistic about Da Nang’s potential to host international fintech events, which would be akin to Korea Blockchain Week, a leading event held in the Republic of Korea.

Tran Hoang Giang, director of FPT's incubation centre, described the positive feedback received from previous blockchain projects in the city, reinforcing its status as a favourable environment for innovation.

On an international scale, country director for Binance in Vietnam Lynn Hoang, emphasised the need for Da Nang to adopt a flexible regulatory framework similar to that of the United Arab Emirates (UAE).

The UAE has seen a surge in digital asset transactions following the introduction of legislation that supports cryptocurrency companies, resulting in a 51% increase in digital asset trading in Dubai.

With its strategic location and favourable climate, Da Nang possesses the necessary attributes to evolve into a financial hub in the region, provided that appropriate policies are enacted.

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