Kyrgyzstan to Launch Gold-Backed Stablecoin USDKG in Third Quarter
Kyrgyzstan will launch the Gold Dollar (USDKG), a gold-backed stablecoin pegged 1:1 with the U.S. dollar, in Q3 2023. Key details include:
- Backed by $500 million in gold from the Kyrgyz Ministry of Finance.
- Aims to facilitate cross-border transfers; remittances constitute 30% of GDP.
- Plans to expand gold reserves to $2 billion with independent audits for transparency.
- Stablecoin overcollateralized to mitigate price volatility risks associated with gold.
- Initial focus on Central Asia, with future expansion into Southeast Asia and the Middle East.
- Not designed to track gold prices; backed solely by gold reserves at a 1:1 ratio with USD.
- Holders can redeem USDKG for physical gold, other crypto assets, or fiat currency.