Kyrgyzstan is set to launch its own digital currency, USDKG, pegged to the U.S. dollar and backed by physical gold reserves, in the third quarter of 2025. The stablecoin will hold a 1:1 ratio with the U.S. dollar, starting with $300 million in initial gold reserves that are planned to grow to $2 billion. This USDKG project has received approval and support from the Kyrgyz Ministry of Finance and will be funded through purchases of physical gold from the National Bank. The over-collateralization model used in USDKG’s framework mitigates potential gold price fluctuations, allowing users to redeem their stablecoin holdings in either physical gold, cryptocurrencies, or fiat currency. This initiative aims to enhance cross-border payment infrastructure in Central Asia and promote international trade.