Vietnam Bank Account Purge Creates Debate Over Bitcoin’s Role

Vietnam’s bank account purge has restarted the debates about financial independence and the appeal of Bitcoin. At the start of September, commercial banks in the country deleted over 86 million accounts, which is nearly half of the estimated 200 million in use.

The State Bank of Vietnam said the move was designed to fight fraud and cybercrime. 

Accounts without biometric verification or those long inactive were the first to go. Yet the scale of the purge has raised issues about trust in banking and whether individuals should rely more on decentralised money.

Biometric Banking and Account Closures

Authorities now require face scans for registering bank accounts and for some online transfers. Transactions above 10 million VND (about $379) or daily totals of more than 20 million VND ($758) cannot proceed without biometric confirmation.

Out of 200 million accounts nationwide, 113 million survived the verification sweep. The remaining 86 million were deleted or frozen for failing to comply.

Foreign residents and expatriates were disproportionately affected. Many could not easily visit branches for in-person verification, leaving them locked out of their funds. 

Dormant accounts also disappeared, sometimes without warning to the holders.

Bitcoin vs Banks In Competing Models

The Vietnam bank account purge has restarted the Bitcoin vs banks discussion. 

Supporters argue that Bitcoin avoids the issues with centralised finance. 

Unlike traditional bank accounts, Bitcoin can be held directly by the user, without relying on intermediaries.

This feature makes it difficult for governments or institutions to freeze funds. Supporters also describe it as financial sovereignty. Money that cannot be seized or denied due to changing policies or technical requirements.

Critics, however, are warning that Bitcoin has its own set of risks. Its price is volatile, and key management is very important. 

Moreover, for daily spending, most users still need fiat on-ramps, which link them back to traditional banking.

RELATED: Vietnam Closes Another 86 Million Bank Accounts, A Week After Thailand Froze 3 Million

Why Vietnam Turned to Biometrics

Vietnam’s government argues that biometric authentication improves security. Officials say recent fraud cases using AI-generated faces justified the tighter rules.

In one case, police dismantled a network accused of laundering more than $38 million by bypassing weak security checks. Authorities say that facial scans reduce similar threats and help support the country’s push toward a “cashless” economy.

While fraud prevention is a valid cause for worry, critics say these measures create new problems. 

Linking financial access to biometric data increases reliance on centralised systems and introduces risks if databases are hacked.

Critics say that Vietnam is doing this as part of a pilot for a CBDC, but time will tell what is truly going on.

Market Reaction and Bitcoin Price

The purge generated hot discussions in the crypto community but had little effect on Bitcoin’s price.

On September 22, Bitcoin traded at $112,539, down 1.9%  on the week. Ethereum and Solana also fell, in a show of general market weakness rather than specific reactions to Vietnam.

Overall, Supporters of Vietnam’s new rules point to reduced fraud and stronger consumer protection. They argue that as digital banking grows, stronger verification is necessary to safeguard users.

Opponents, however, counter that the loss of 86 million accounts proves that the costs outweigh the benefits. Shutting people out of the system leaves millions without financial services. 

This exclusion fuels distrust and strengthens the argument for decentralised alternatives.

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