Kyrgyzstan Moves Toward a State Crypto Reserve
In a historic move, Kyrgyzstan has passed amendments to its “On Virtual Assets” law in parliament to establish a state cryptocurrency reserve and government-led mining.
The draft law was championed by Bakyt Sydykov, Kyrgyzstan’s Minister of Economy and Commerce, and it will soon be submitted to President Sadyr Japarov after clearing three parliamentary readings.
The law sets rules for the issuance and circulation of stablecoins, tokenized real-world assets (RWAs), and state-backed crypto projects.
According to Sydykov, a crypto reserve will enable the state to create its own digital assets via mining, tokenization, and issuance of fiat-backed stablecoins.
Crypto Reserve as a Tool for Financial Stability
Sydykov emphasized that establishing a state crypto reserve would diversify national assets and reduce economic risks, thereby strengthening financial security.
However, the tariffs set by the government for the mining sector will continue to apply to state-owned companies, just as they do to private firms.
He clarified speculation by stating that power plants would not be redirected solely for large-scale government mining operations.
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A Diversified Digital Asset Strategy
Kyrgyzstan’s planned crypto reserve will not rely exclusively on Bitcoin or other existing cryptocurrencies, unlike traditional reserves. Instead, the state will build a mixture of digital assets, designed to strengthen economic resilience.
As per the bill, the cryptocurrency reserve will function as part of the state hedge fund, with the President issuing directives on how it will be managed, stored, and utilized.
Additionally, Kyrgyzstan is preparing for the launch of a central bank digital currency (CBDC), marking a gradual shift toward digital finance.
Central Asia’s Crypto Race
Kyrgyzstan’s initiative follows its neighbor Kazakhstan, whose President Kassym-Jomart Tokayev recently called for the creation of a strategic crypto reserve, while also promoting AI and blockchain innovation.
With both nations pushing government-backed frameworks, Central Asia is quickly emerging as a major destination in the global crypto economy.
