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Vietnam Vows Cryptocurrency Crackdown After $660 Mln Scam

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The government of Vietnam has announced a crackdown on the country's cryptocurrency market in the wake of a multi-million-dollar fraud.

Ho Chi Minh City-based startup Modern Tech JSC has gone underground after duping 32,000 people of an estimated VND 15 trillion ($660 million) in relation to two fake cryptocurrency projects and their initial coin offerings (ICOs).

Prime Minister Nguyen Xuan Phuc signed an order to draft new rules to "strengthen the management of activities related to cryptocurrencies". He warned financial institutions against accepting digital currencies, and said strict action would be taken against those dealing in them.

Currently, there are no laws in Vietnam banning the possession of assets such as Bitcoin and Ethereum. The government had plans last year to develop a legal framework to manage cryptocurrencies and digital assets as they increase in popularity in the east Asian country.

Bitcoin and other cryptocurrencies operate independent of governments and banks, and sparked concerns that they can be used to launder money for criminal networks.

Authorities have launched an investigation into the Modern Tech scam.

The State Bank of Viet Nam (SBV) has reportedly agreed to co-operate with police to investigate the case.

On Sunday, dozens of people who lost their money after buying iFan and Pincoin cryptocurrencies gathered at the so-called headquarters of the Modern Tech Co. at 68 Nguyen Hue Street, District 1, carrying banners saying "biggest digital money fraud in history." They later realized that the company had cleared out its office about a month ago.

Modern Tech had claimed to be the authorized Vietnamese representative of two cryptocurrencies, Ifan and Pincoin, and was responsible for conducting two ICOs on their behalf.

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