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"Bubbles” of digital currency will burst any time

17:02 | 24/12/2017

VCN- Bitcoin and “virtual currency” has become “hot” as their values increase. In Vietnam, many individuals and organizations are interested in this currency but the management for them is still “unknown”.

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The majority of people flock into the digital currency market for speculation. Photo: Internet

At the talk, "Bitcoin and the Blockchain wave" held on 20th December, experts evaluated that digital currency and blockchain is a new technology trend, but in Vietnam there are many misunderstandings, leading to speculation and wrongful use.

According to Mr.Dominik Weil, the founder of bitcoin.vn website, Bitcoin is the first application of blockchain technology. From the point of view of investment, Bitcoin is the same as other investment tools, it is a new asset form of buying when the value is low and selling when the value is high. But from the view of product supplier, most people flock into the market to seek benefit, speculate and want to buy to sell when the price goes up.

According to lawyer Truong Thanh Duc, Chairman of BASICO Law Company, under the current provisions there are 3 types of asset, thing, money and assets. However, Bitcoin does not belong to any type, so it is considered as virtual assets, or known as “virtual currency” in Vietnam. But in nature, Bitcoin is not currency, so the concept “virtual currency” is quite correct in Vietnam but incorrect with the rest of the world.

“Currently, there are no circulars or decrees prohibiting exchange and transaction of digital currencies. But according to the warning by the State bank, because Bitcoin is not currency, the use of Bitcoin for payment will be a banned act” Mr. Duc added.

Mr. Nguyen Duy Hung, Chairman of the Board, General Director of Saigon Securities Inc. (SSI), and Chairman of PAN Group, said that the wave of playing digital currency is real, player use real resources, real business to transact and exchange digital currency. Thereby, the legal loopholes cause the difficulties in management or tax collection when transacting this currency.

According to lawyer Truong Thanh Duc, the law does not stipulate whether the exchange or payment is permitted or not, and this poses a difficult question. Because the sale of digital currency requires real currency and the transfer of digital currency from person to person, or between countries, must be controlled. The banks must rigorously control the exchange of Bitcoin.

However, in addition to risk and legal loopholes, experts also emphasized the dangers of "bubbles", which this currency can bring to individuals and organizations that focus on speculation.

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Commenting on the future trend of digital currency, experts said that it is difficult to predict. Accordingly, in the next 1-2 years this digital currency might increase, even up to US $50,000-100,000. But over a long term, it may not be possible to continue the uptrend, due to the appearance of many other digital currencies. Bitcoin will divide into many different currencies.

Because of the above risks, individuals and organizations who speculate in digital currency must be careful, because digital currency is a technology product, and nobody knows when the "bubbles” will burst. According to Mr. Nguyen Duy Hung, what sharply increases, it will surely break and become a big financial crisis.

By Huong Diu/Ngoc Loan