Kyrgyzstan’s New Dollar-Pegged, Gold-Backed Stablecoin USDKG to Launch in the Third Quarter.

Kyrgyzstan is gearing up to launch USDKG, a gold-backed stablecoin pegged to the U.S. dollar, by the third quarter of 2025. The announcement was made by Gabriel Guerra, an advisor to the project, at the Token2049 conference held in Dubai.

USDKG will be backed by $500 million in gold reserves held by the Kyrgyz Ministry of Finance, with plans to increase the reserves to $2 billion over time. The stablecoin aims to offer a secure and transparent digital asset for users, particularly for those involved in cross-border transactions and remittances.

In response to growing demand for stable assets in the digital economy, the stablecoin will provide users with the flexibility to redeem their tokens for gold, cryptocurrencies, or fiat currencies. While pegged to the U.S. dollar, USDKG will be unique in its backing by gold, which offers a hedge against inflation and currency devaluation.

Kyrgyzstan’s move is positioned as a response to the increasing need for efficient cross-border payment solutions, particularly in Central Asia, where remittances play a significant role in the economy. USDKG is expected to gain traction as a reliable store of value and transaction medium for users in the region.

The Kyrgyz government plans to regularly audit the gold reserves to ensure they match the number of tokens in circulation, offering transparency and security for investors and users alike.