Three key factors to boost blockchain adoption in Vietnam

Blockchain technology and its applications in finance, business, agriculture, supply chains, healthcare and more are gaining in popularity and recognition in many countries, including Vietnam.

This is evident in the Prime Minister’s Decision No. 1236/QD-TTg on the national blockchain strategy and the launch of the national blockchain platform NDAChain, which will serve as a core infrastructure for Vietnam’s digital economy by enabling unified authentication, traceability, and verification of digital data, transactions, and assets.

Vietnam’s ongoing efforts to develop a legal framework for crypto assets (most of which are created and verified via blockchains) also reflect the growing importance of this technology.

According to Dr Nguyen Thanh Phong, a lecturer in Blockchain Enabled Business at RMIT University Vietnam, one of the key factors determining the success of any technology, including blockchain, is the level of adoption by individuals, households, and businesses.

While Vietnam ranks among the top countries in terms of cryptocurrency adoption, expanding public understanding and adoption of other blockchain applications should be a national priority. Only then can the country fully leverage the technology’s strengths in terms of data security, efficiency, and accuracy.

“We should aim for a future where blockchain is embedded in many aspects of life. For example, farmers can use blockchain to trace the origin of agricultural products and increase export value. Hospitals can use it to securely store medical records and share data across medical facilities without the risk of data breaches,” Dr Phong said.

Given Vietnam’s current context and the global trajectory of blockchain development, a critical question arises: What actions should we take and what policies should we prioritise to increase blockchain adoption and ensure the success of the national blockchain strategy?

According to a study by Dr Phong and Dr Nguyen Thi My Linh (Senior Program Manager in Finance at RMIT Vietnam), published in the Q1-ranked journal Technological Forecasting and Social Change, increasing adoption of blockchain-based products and services remains a significant challenge for many nations.

Based on data from over 40 countries, the researchers found that blockchain adoption – particularly for decentralised finance (DeFi) – is a complex, multi-dimensional issue.

Dr Linh explained that adoption levels depend on a combination of many factors, such as social factors (social connectedness, human development, population), economic factors (GDP per capita, inflation, financial development), technological factors, and cultural factors (such as future orientation).

“Among these dimensions, social, economic, and cultural factors play the most critical roles in driving blockchain adoption,” Dr Linh said.

On the social front, the RMIT research team recommends that policymakers focus on human development, guided by the United Nations’ Human Development Index (HDI).

“Vietnam needs to strengthen public health policies, such as improving the quality of healthcare services and insurance. Expanding access to education, particularly in remote and rural areas, is also essential,” said Dr Phong.

Measures to increase household income, such as raising the minimum wage and supporting small and medium-sized businesses, should also be prioritised.

“In general, knowledge, health, and a good quality of life are the foundations that prepare people to embrace blockchain applications and innovations,” Dr Phong added.

On the economic side, RMIT’s research shows that inflation significantly affects the adoption of DeFi - a financial model built on blockchain technology that operates without traditional intermediaries like banks. DeFi is often seen as a promising pathway to financial inclusion.

“The long-term and effective solution is to build a strong and sustainable financial system, supported by sound monetary policies and a robust legal framework,” Dr Linh noted.

“Our research shows that if such a financial system is in place, inflation will no longer be a major factor influencing blockchain adoption. In that case, the financial system will be better positioned to support blockchain and DeFi development.”

In addition to the social and economic factors, future orientation is a key cultural element in blockchain development. According to the two RMIT experts, this highlights the importance of incorporating future-oriented thinking into education and training programs.

Notably, the study by Dr Linh and Dr Phong found that while factors like GDP per capita and ICT infrastructure are relevant, they are not the most decisive in driving blockchain development.

“This means that in the early stages, blockchain adoption does not heavily depend on whether a country has high or low income or ICT capacity,” Dr Phong explained.

The RMIT experts stated that with the upcoming large-scale integration of the national blockchain platform, the improved legal framework, and the active participation of government agencies, businesses, and universities, Vietnam is on the right track to unlocking the full potential of blockchain technology.

“If we continue to promote the social, economic, and cultural factors as proposed, Vietnam can absolutely become a pioneer in blockchain adoption, advancing financial inclusion, data transparency, and innovation,” Dr Linh concluded.

Story: Ngoc Hoang

Masthead image: elenabsl – stock.adobe.com | Thumbnail image: Tstudious – stock.adobe.com