Kyrgyzstan has become the first country in the world to launch an officially issued, government-backed stablecoin fully secured by physical gold. The USDKG digital token was unveiled on November 20 during a ceremony attended by President Sadyr Japarov, the presidential press service reported.
Finance Minister Almaz Baketayev and Biibolot Mamytov, chairman of the state-owned Virtual Asset Issuer JSC, also participated in the launch. The company, operating under the Ministry of Finance, developed and issued the new stablecoin.
At the ceremony, officials pressed a symbolic “Launch Issuance” button to mint 50 million USDKG tokens on the Tron blockchain. Each token is pegged to the U.S. dollar and fully backed by physical gold, according to Fergana News.
Developers say USDKG combines gold’s traditional stability with the transparency and technological advantages of blockchain, making it a secure and reliable digital currency. The Ministry of Finance noted that the issuance is part of a pilot program to advance the digital economy and strengthen Kyrgyzstan’s financial sovereignty.
The stablecoin is intended to serve as the backbone of a national Web3 infrastructure, supporting decentralized solutions across public and private sectors. It is also expected to attract investment and bolster international technological cooperation.
Project advisor Gabriel Guerra said the token’s primary purpose is to facilitate cross-border payments. The Ministry of Finance has provided an initial gold reserve of $500 million, with plans to increase it to $2 billion.
Guerra added that unlike tokens such as USDT or PAXG, the value of USDKG is not tied to the fluctuating market price of gold. Instead, it maintains a fixed rate of 1 USDKG to $1, with full gold backing. Holders will be able to redeem the token for physical gold, other cryptocurrencies, or fiat currency.
