Kyrgyzstan's Crypto Frontier: Launch of USDKG Amid Power Struggles

Kyrgyzstan launches over $50 million in stablecoin USDKG, backed by gold and pegged to the U.S. dollar, while halting crypto mining due to electricity shortages. The token is intended for cross-border payments. The government is exploring energy-saving measures and electricity imports amid low water levels at hydro plants.

Kyrgyzstan has introduced over $50 million worth of its national stablecoin, USDKG, backed by gold and pegged to the U.S. dollar, according to the country's financial regulator. This initiative reflects Kyrgyzstan's bid to be a pioneer in cryptocurrency within Central Asia despite facing sanctions from Western nations.

During the same period, all crypto mining operations in Kyrgyzstan were shut down due to an electricity shortage caused by low water levels at main hydroelectric plants. This decision stems from the country's efforts to prioritize power conservation amidst urgent energy needs.

Kyrgyz President Sadyr Japarov has voiced concerns over Western sanctions, urging not to politicize the economy. The government plans to allocate $500 million eventually reaching $2 billion to back the USDKG, aiming to utilize it for cross-border payments.

(With inputs from agencies.)