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[Letterhead of Haynes and Boone, LLP]

August 11, 2005

Via Facsimile (202) 772-9210

Ms. Rebekah Toton

Securities and Exchange Commission

450 Fifth Street NW

Mail Stop 4561

Washington, DC  20549

Re:

Validian Corporation

Post-Effective Amendment No. 1 to Form SB-2

Filed July 8, 2005, File No. 333-114289

Post-Effective Amendment No. 1 to Form SB-2

Filed July 8, 2205, File No. 333-114303

Form 10-KSB/A for the Fiscal Year Ended December 31, 2004

Form 10-QSB for the Quarter Ended March 31, 2005

File No. 0-28423

Dear Ms. Toton:

Please find attached on behalf of Validian Corporation (the “Company”), as supplemental filing material, the proposed changed pages to (1) the draft Amendment No. 2 to the Company’s Annual Report on Form 10-KSB (“Form 10-KSB/A”), (2) the draft Amendment No. 1 to the Company’s Quarterly Report on Form 10-QSB (“Form 10-QSB/A”) and (3) the draft Post-Effective Amendments No. 2 to the Registration Statements on Form SB-2 (the “Registration Statements”).  It is our intention to formally file the Form 10-KSB/A, Form 10-QSB/A and the Registration Statements via EDGAR once we have cleared all Staff comments thereto.

The changed pages to the draft Form 10-KSB/A, Form 10-QSB/A and the Registration Statements reflect revisions made in response to the comments of the staff (the “Staff”) of the Securities and Exchange Commission (the “Commission”) set forth in its letter dated August 8, 2005.  In addition, we have updated the risk factor on penny stocks pursuant to the new penny stock rules and we have updated certain other items, including adding more recent stock price information.  The Form 10-KSB/A, Form 10-QSB/A and the Registration Statements have each been marked to show changes to the form of each document as previously filed with the Commission (for the convenience of faxing, we have not included all pages of the Form 10-KSB/A and Form 10-QSB/A that represent deletions of material not being amended).  For your convenience, we have restated the Staff’s comments below, together with a response to each respective comment.  The page references are to the hand marked page numbers at the bottom of each changed page included in this facsimile.

Ms. Rebekah Toton

August 11, 2005

Page 2

Post-Effective Amendment to Form SB-2 (File No. 333-114289)

General

l.

We note that you also filed a post-effective amendment to a registration statement on Form SB-2 (file no. 333-114303) relating to the resale of over 10 million shares of common stock.  Please revise this post-effective amendment to include a brief description of all concurrent public offerings in the prospectus and expand your front cover page to disclose the existence of any concurrent offerings and to indicate the number of shares covered by other registration statements.  This comment also applies to your post-effective amendment to Form SB-2 (file no. 333-114303).

Response:  We have revised the cover page of each of the Registration Statements in response to the Commission’s comment (see pages 21 and 31 of the marked pages).  We note also that the body of the prospectus included in Post-Effective Amendment No. 1 included a reference to the concurrent offering (see page 4 of the Registration Statements as previously filed).  Please let us know if the staff desires additional disclosure.

Form 10-KSB for the Fiscal Year Ended December 31, 2004, as amended

Item 8A, Controls and Procedures, page 59

2.

We note the disclosure that your independent registered public accounting firm advised you of certain significant internal control deficiencies that they considered to be, in the aggregate, a material weakness in connection with their audit of your consolidated financial statements.  We further note that your President and Chief Executive Officer and Chief Financial Officer and Treasurer concluded that your controls and procedures were not effective as of the end of the period due to these significant deficiencies, namely inadequate supervision and segregation of duties.  Please revise to disclose in greater detail the nature of the material weakness identified in your disclosure.  In this regard, also revise to disclose the specific steps that the company has taken, if any, to remediate the material weakness, disclose when the material weakness first began, and disclose whether the company believes that the material weakness still exists at the end of the period covered by the report.  This comment also applies to the Item 3 disclosure in your Form 10-QSB for the quarter ended March 31, 2005.

Response:  We have revised the Form 10-KSB/A and Form 10-QSB/A in response to the Staff’s comment (see page 8 of the marked pages relating to the Form 10-KSB/A and page 17 of the marked pages relating to the Form 10-QSB/A).

3.

To the extent that the size and resources of your company will not enable you to address this material weakness and the ineffectiveness of your disclosure controls and procedures, you should expand your risk factor disclosure on page 18 to specifically address the risk to both your company and investors posed by this ongoing material weakness and ineffective disclosure controls and procedures.  This comment also applies to the Item 3 disclosure in your Form 10-QSB for the quarter ended March 31, 2005 and the risk disclosure in both your post-effective amendments.

Ms. Rebekah Toton

August 11, 2005

Page 3

Response:  We have revised the Form 10-KSB/A, Form 10-QSB/A and Registration Statements in response to the Staff’s comment (see pages 6 and 8 of the marked pages relating to the Form 10-KSB/A, page 17 of the marked pages relating to the Form 10-QSB/A and pages 25-26 and 35-36 of the marked pages relating to the Registration Statements).

4.

Please revise to provide the disclosure required by Item 308(c) of Regulation S-B.  In this regard, disclose any change in your internal control over financial reporting that occurred during the last fiscal quarter that has materially affected, or is reasonably likely to materially affect, your internal control over financial reporting.  This comment also applies to the Item 3 disclosure in your Form 10-QSB for the quarter ended March 31, 2005.

Response:  We have revised the Form 10-KSB/A and Form 10-QSB/A in response to the Staff’s comment (see page 13 of the Form 10-KSB/A and page 18 of the marked pages relating to the Form 10-QSB/A).

We will include the “Tandy letter” language in the Company’s acceleration request.  In addition, please confirm that the Company need not file Section 906 certifications with the Form 10-KSB/A and Form 10-QSB/A because they do not include financial statements.  The Company will file the Section 302 certifications with these documents.

We would appreciate your prompt review of the attached pages.  If you have any questions, please contact me at (214) 651-5330 or William L. Boeing at (972) 680-7553.

Very truly yours,

/s/ Jennifer Wisinski

Jennifer Wisinski

Of Counsel/Senior Attorney

Direct Phone Number:  214.651.5330

Direct Fax Number:  214.200.0768

jennifer.wisinski@haynesboone.com

cc:

Ron Benn

Laurie Mulvagh

William L. Boeing

Attachments:

Revisions to 10KSB, pages 1 - 14

Revisions to 10QSB, pages 15 - 19

Revisions to debenture SB-2/A, pages 20 - 29

Revisions to equity SB-2/A, pages 30 - 39

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-KSB/A

AMENDMENT NO. 12

[X] ANNUAL REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE FISCAL YEAR ENDED DECEMBER 31, 2004

[  ] TRANSITION REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

FROM                          TO

VALIDIAN CORPORATION

(Name of small business issuer in its charter)

NEVADA

 000-28423

 58-2541997

(State or other jurisdiction of incorporation or organization)

 Commission File No.

 (I.R.S. Employer Identification Number)

30 Metcalfe St., Suite 620, Ottawa, Ontario, Canada

   K1P 5L4

(Address of principal executive offices)

   (Zip Code)

Issuer’s telephone number:  613-230-7211

Securities registered under Section 12(b) of the Exchange Act:   none

Securities registered under Section 12(g) of the Exchange Act: Common Stock, par value $.001 per share

Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.   YES [X]  NO [   ]

Check if there is no disclosure of delinquent filers in response to Item 405 of Regulation S-B contained in this form, and no disclosure will be contained, to the best of the registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-KSB or any amendment to this Form 10-KSB.  [ X ]

State issuer’s revenues for its most recent fiscal year.  $

NIL

The aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the average between the closing bid ($0.45) and asked ($0.45) price of the issuer’s Common Stock as of March 11, 2005, was $10,751,737, based upon the average between the closing bid and asked price ($0.45) multiplied by the 23,892,749 shares of the issuer’s Common Stock held by non-affiliates. (In computing this number, issuer has assumed all record holders of greater than 5% of the common equity and all directors and officers are affiliates of the issuer.)

The number of shares outstanding of each of the issuer’s classes of common equity as of March 11, 2005: 31,434,537.

DOCUMENTS INCORPORATED BY REFERENCE:  See Index to Exhibits, page 66.

Transitional Small Business Disclosure Format: Yes [   ]  No [ X ]

SEC 2337 (8-04)

 Persons who potentially are to respond to the collection of information contained in this form are not required to respond unless the form displays a currently valid OMB control number.

page 1

Explanatory Note

This Form Amendment No. 1 on 10-KSB/A is being filed to correct typographical errors in the following line items in “Item 7.  Financial Statements”:  (1) prepaid expenses and total current assets for 2004 in the consolidated balance sheet; (2) Deferred financing costs transferred to additional paid in capital on conversion of 4% senior subordinated convertible debentures into common shares in the consolidated statements of changes in stockholders’ equity (deficiency) and comprehensive loss for 2004; and (3) non-cash interest expense for the period August 3, 1999 to December 31, 2004 and net cash provided by financing activities for 2004 in the consolidated statements of cash flows.  These typographical errors were also corrected in “Selected Financial Data” in “Item 6.  Management’s Discussion and Analysis or Plan of Operation.”

page 2

VALIDIAN CORPORATION

Form 10-KSB

December 31, 2004

Table of Contents

Page No.

Cautionary Notice Regarding Forward-Looking Statements

4

Part I

Item 1.

Description of Business.

5

Item 2.

Description of Properties.

19

Item 3.

Legal Proceedings.

19

Item 4.

Submission of Matters to a Vote of Security Holders.

19

Part II

Item 5.

Market for Common Equity and Related Stockholder Matters

21

Item 6.

Management's Discussion and Analysis or Plan of Operation.

23

Item 7.

Financial Statements.

29

Item 8.

Changes In and Disagreement With Accountants on Accounting and

Financial Disclosure.

59

Item 8A.

Controls and Procedures.

59

Item 8B.

Other Information

59

Part III

Item 9.

Directors, Executive Officers, Promoters and Control Persons: Compliance

with Section 16(a) of the Exchange Act.

60

Item 10.

Executive Compensation.

61

Item 11.

Security Ownership of Certain Beneficial Owners and Management

and Related Stockholder Matters

64

Item 12.

Certain Relationships and Related Transactions.

66

Item 13.

Exhibits.

67

Item 14

Principal Accountant Fees and Services.

67

Signatures

69

page 3

CAUTIONARY NOTICE REGARDING FORWARD-LOOKING STATEMENTS

We caution readers that certain important factors may affect our actual results and could cause such results to differ materially from any forward-looking statements that we make in this report.  For this purpose, any statements that are not statements of historical fact may be deemed to be forward-looking statements.  This report contains statements that constitute "forward-looking statements." These forward-looking statements can be identified by the use of predictive, future-tense or forward-looking terminology, such as "believes," "anticipates," "expects," "estimates," "plans," "may," "will," or similar terms.  These statements appear in a number of places in this report and include statements regarding our intent, belief or current expectations with respect to many things.  Some of these things are:

*

trends affecting our financial condition or results of operations for our limited history;

*

our business and growth strategies;

*

our technology;

*

the Internet; and

*

our financing plans.

We caution readers that any such forward-looking statements are not guarantees of future performance and involve significant risks and uncertainties.  In fact, actual results most likely will differ materially from those projected in the forward-looking statements as a result of various factors.  Some factors that could adversely affect actual results and performance include:

*

our limited operating history;

*

our lack of sales to date;

*

our future requirements for additional capital funding;

*

the failure of our technology and products to perform as specified;

*

the discontinuance of growth in the use of the Internet;

*

the enactment of new adverse government regulations; and

*

the development of better technology and products by others.

The information contained in the following sections of this report identify important additional factors that could materially adversely affect actual results and performance:

*

"Part I. Item 1. Description of Business" especially the disclosures set out under the heading "Risk Factors"; and

*

"Part II. Item 6. Management's Discussion and Analysis or Plan of Operation"

You should carefully consider and evaluate all of these factors. In addition, we do not undertake to update forward-looking statements after we file this report with the SEC, even if new information, future events or other circumstances have made them incorrect or misleading.

This Amendment No. 2 to Form 10-KSB/A amends (1) Part I, Item 1—Description of Business and (2) Part II, Item 8A—Controls and Procedures of the Amendment No. 1 to the Annual Report on Form 10-KSB/A filed by Validian Corporation on April 22, 2005.

PART I

page 4

We do not intend to pay dividends in the near future.

Our board of directors determines whether to pay dividends on our issued and outstanding shares.  The declaration of dividends will depend upon our future earnings, our capital requirements, our financial condition and other relevant factors.  Our board does not intend to declare any dividends on our shares for the foreseeable future.

Our common stock may be deemed to be a "penny stock."  As a result, trading of our shares may be subject to special requirements that could impede our shareholders' ability to resell their shares.

Our common stock ismay be deemed to be a "penny stock" as that term is defined in Rule 3a51-1 of the Securities and Exchange Commission because it is selling at a price below five dollars per share.  In the future, if we are unable to list our common stock on NASDAQ or.  Penny stocks include stocks:

*

that are not traded on a national securities exchange, or the per share sale price is not at least $5.00, our common stock may continue