Kyrgyzstan Set to Launch Gold-Backed Stablecoin USDKG in 2025

In Kyrgyzstan, the launch of the gold-backed stablecoin USDKG has been announced for the third quarter of 2025. Gabriël Guerra, a project advisor, shared this information at the Token2049 conference, as reported by CoinDesk.

The new coin will be pegged to the US dollar at a 1:1 ratio and will be backed by the country’s gold reserves valued at $500 million. Guerra indicated that the reserves are expected to be increased to $2 billion in the future.

USDKG is intended for cross-border payments and international trade. Initially, the project will be implemented in Central Asia, with plans to expand to the Middle East and Southeast Asia later on.

According to Guerra, this stablecoin will address the issue of remittances, which account for 30% of the nation’s GDP.

To mitigate gold’s volatility, USDKG will be issued with an excess reserve. To ensure transparency, independent auditors will be engaged.

Unlike PAXG or USDT, USDKG does not track the price of gold but is directly convertible into US dollars. Users will have the option to exchange their stablecoins for physical gold, fiat currency, or crypto assets.

Meanwhile, Binance founder Changpeng Zhao (CZ) has suggested to Kyrgyz President Sadyr Japarov that Bitcoin and BNB be included in the national crypto reserve.

It is worth noting that in April, CZ became a consultant to the Kyrgyz government on issues related to cryptocurrencies and blockchain.