KYRGYZSTAN – A new state-backed stablecoin – USDKG – was launched by Kyrgyzstan, becoming the first state-owned digital asset.

The Finance Ministry said on Thursday that the new stablecoin is pegged to the US dollar at a 1:1 exchange rate and backed by gold.

The launch cost the state budget 438,480.75 soms, according to figures from the Open Budget portal, local media reported.

The asset was registered with the Financial Market Regulation and Supervision Service (Finnadzor) last week. It was issued by the open joint-stock company Virtual Asset Issuer, whose sole founder is the Finance Ministry.

Officials said USDKG is designed to facilitate international transactions and expand Kyrgyzstan’s participation in the global digital economy.

At the end of October, Binance founder Changpeng Zhao first revealed plans for the national stablecoin during his meeting with Kyrgyz President Sadyr Japarov.

Japarov earlier instructed authorities to develop the KGST stablecoin and begin testing a digital som as part of the government’s broader blockchain strategy discussed at the National Council for the Development of Virtual Assets and Blockchain Technologies.