Kyrgyzstan to Launch Gold-Backed Stablecoin “USDKG” in Q3 with $500 Million Reserves
The Kyrgyz government is set to launch a gold-backed stablecoin pegged to the US dollar in the third quarter of 2025. The digital currency, dubbed the “Golden Dollar” (USDKG), will initially be backed by $500 million in gold reserves provided by the country’s Ministry of Finance.
The ambitious initiative is a major step taken by the Central Asian country to modernize its monetary infrastructure and capitalize on the growing intersection between blockchain technology and commodity-backed finance.
According to officials, the backing will be entirely in the form of physical gold and will be kept under government custody. The state also plans to increase the reserves to $2 billion depending on the success of the stablecoin’s launch and adoption.
“USDKG will combine the stability of gold with the usability of digital currencies. It will be a secure tool for both domestic and international payments,” a representative from the Ministry of Finance said.
The move comes amid growing global interest in asset-backed stablecoins, particularly among governments seeking ways to remain anchored in stable assets while preserving their monetary sovereignty.
By pegging the stablecoin to the US dollar but backing it with gold, Kyrgyzstan aims to build trust with foreign investors and provide a hedge against inflation.
While technical details and blockchain infrastructure partners have not yet been disclosed, Kyrgyz authorities are expected to share more information ahead of the third-quarter launch.
As countries in Eurasia explore dollarization strategies and embrace digital finance innovations, the stablecoin could potentially serve as a regional means of payment and an alternative reserve asset.
*This is not investment advice.