Vietnam’s first official bitcoin broker, Bitcoin Vietnam, recently announced the relaunch of VBTC, Vietnam’s first bitcoin exchange platform. The fully upgraded exchange, now in partnership with New York-based bitcoin remittance technology provider, BlinkTrade, is faster, more secure, and has a new focus on enabling Bitcoin remittance services for the unbanked population of Vietnam.
Remittance solutions company BlinkTrade was founded in 2013 as a white-label bitcoin exchange. With the help of the Boost.VC accelerator, it has since evolved, now providing remittance technologies to exchanges, brokers, and companies.
“BlinkTrade is building a network of bitcoin exchanges across the globe, with presence currently in Brazil, Venezuela, Chile, Pakistan and now Vietnam. We are connecting Remittance companies in the USA with exchanges in the Blinktrade Bitcoin Exchanges network; aiming to reduce costs of remittances while increase the speed of settlement.”
- Rodrigo Souza, Blinktrade Co-Founder
Blinktrade is focused on Vietnam as it sorely lacks modern financial infrastructure. According to 2014 data from the World Bank, about 31 percent of Vietnam's population reported having an account at a bank or financial institution, compared to the global average of 62 percent.
Although this is quite an increase, from 21 percent in 2011, approximately 70 percent of the Vietnamese population has no access to modern banking solutions.
It should be noted that wealth is not the only factor that allows access to the banking system. Among the country's richest 60 percent, only 39 percent reported having an account at a financial institution.
According to the World Bank statistics, Vietnam receives the 11th highest amount of remittances of any country, with India and China scoring the top two positions.
Vietnam's remittance inflows have been increasing steadily over the years, with the 2014 remittance inflow of approximately US$12 billion.
The Vietnamese receive most of their remittances from family in the US, followed by Australia and Canada. Remittance from the US is estimated at US$6.8 billion, whereas Australia only sends US$1 billion to the country.
More than just a remittance solution, however, with this relaunch BlinkTrade hopes to provide the unbanked population with access to modern banking alternatives, all 70 percent of them.
Nearly everything about the VBTC service has been replaced, but perhaps the most impressive upgrade is the new ability deposit and withdrawal cash from more than 9,200 banking locations in the country. Without the need for a bank account.
“These locations are all of the commercial bank branches in Vietnam. We are making use of a system, which when translated to English, means something like ‘Cash-to-ID’.” Dominik Weil, Bitcoin Vietnam Co-founder, told Brave New Coin. “All we need is the ID data of the customer to send the money to the chosen bank branch, and the client can withdraw the money in cash. (With no need for a bank account.)”
This unprecedented level of access to remittances is available now, and allows for anyone in the country to pick up remittance payments at their nearest bank, in Đồng, the local currency.
"VBTC will allow us to handle Bitcoin remittance services towards Vietnam in a very fast and price competitive way. In an ideal setup it will take you less than one hour to send funds to your beloved ones in Vietnam, from sending the Bitcoins to us until the recipient in Vietnam holds the cash in his hands.”
- Dominik Weil, Bitcoin Vietnam Co-founder
All with competitive fees, as well. “The transaction cost for cash withdrawals are even cheaper than the normal bank wire fees to the client's account,” Weil added.
On top of remittance solutions, using banking locations allows for instant bitcoin deposits into the VBTC exchange, allowing verified users to quickly fund trades on the exchange, and make trades without leaving funds on the exchange for prolonged periods of time.
However, there is now a lot less risk if users leave funds with them as security was another major upgrade. By integrating with industry-leading multisig wallet technology provider BitGo, VBTC provides secured account trading with multi-signature cold wallets, which require co signing by two of the three parties involved; BlinkTrade, Bitcoin Vietnam, and BitGo, in order to move customer funds.
Not only do two out of three security systems need to be breached in any possible theft of bitcoin at the exchange, but BitGo also provides insurance of up to US$250,000 in case of operational security failures.
Contrary to previous rumors, bitcoin use has never been prohibited in Vietnam, even after the State Bank publicly declared that bitcoin has no legal tender status, in Feb 2014, and that funds or payments in Bitcoin are not protected by the law.
“Even if Bitcoin in itself may be still at a very nascent stage in Vietnam so far, the tech sector especially in our location of Ho Chi Minh City is expanding rapidly year by year; the youth of our nation is adopting to new technologies in a fascinating speed... cryptocurrency will play an important part in the daily life/operations of consumers and business.”
- Nguyen Tran Bao Phuong, CEO of Bitcoin Vietnam
While bitcoin is nowhere near being widely used and adopted in the country yet, the small bitcoin community and general interest are both rapidly growing. Bitcoin Vietnam are in talks with the country's State Bank, and a department of public security, to define applicable regulations for Bitcoin usage in the country.