As the price of bitcoin rose above US$55,000 per coin since February 19 and the emergence of a new digital currency – Pi – and other virtual currencies, Vietnamese investors are flocking into this industry.

On Thursday, bitcoin was traded at $54,663.26 per coin by 3:30pm, according to coindesk. The digital currency rose over 87.77 per cent this year. 

“Digital currencies are listed on portfolios because bitcoin’s price is too high while prices of other currencies are just at potential levels, from just some US cents to some dollars per coin. It might be like bitcoin some day,” Hoang Ngoc Minh, a cryptocurrency investor, told e-newspaper baodautu.vn.

A global consumer survey conducted by Statista showed that Vietnam has the second highest rate of cryptocurrency use, while the most likely to use or own digital currency is Nigeria.

The surge in trading of cryptocurrencies among local investors in many provinces raised concerns from Government agencies and experts.

Earlier this month, the Ministry of Finance said that recently, the State Securities Commission of Việt Nam (SSC) has worked regularly with the police to solve cases related to illegal trading of digital currencies and stocks via platforms like Rforex in Ba Dinh District, Hanoi or Emrfx in Nghe An Province.

The ministry also asserted that currently, only the Ho Chi Minh Stock Exchange and Hanoi Stock Exchange are allowed to organise the trading of securities in Vietnam.

SSC also warned investors to be cautious when investing in cryptocurrencies and virtual assets and asked public companies, securities firms, fund management companies and investment funds not to provide trading and intermediary services for cryptocurrencies.

However, Pham Duy Khuong, CEO of ASL Law Firm, said that the number of fake cryptocurrencies is rising and they are sucking “blood” from Vietnamese investors. The surge of bitcoin has become a good excuse for these cryptocurrency scams.

Earlier this year, police in Da Nang warned about a new scam via investment platforms downloaded from the App Store and CH Play which were issued by securities companies.

Despite warnings from government agencies and experts, some members of the Pi mining community in Vietnam still stand by the Pi Network. They advocated the mining costs are nothing as their personal information is leaked from using applications like Facebook or Google, so they just mine and wait until the price surges.

Dr Ngo Tri Long, former director of the Ministry of Finance’s Price and Market Research Institute, said that Pi doesn’t have a clear origin so it cannot be priced and miners shouldn’t have faith in it. The operation model of Pi is the same as a Ponzi scheme, which is to pay profits to earlier investors with funds from newer investors.

Even though miners don’t have to pay any fees at the moment to join the Pi Network, once it get access to important personal data, it might charge investors to continue their investments.

“At the moment, there is no investment, so there is no risk. But once it attracts investment, transactions occur then there will be risks. And the risks might be more than other digital currencies since Pi doesn’t have a history or market,” Financial and Banking expert Nguyen Tri Hieu told baodautu.vn.  

VNS

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