OREANDA-NEWS  The Kyrgyz government has liquidated the state-owned stablecoin USDKG (United States Dollar Kyrgyzstan), launched in November last year. This is stated in a message posted on the cryptocurrency's website.

All holders of USDKG tokens can apply to exchange them for fiat money, that is, government currencies, or USDT. The USDKG was equated to the US dollar in a one-to-one ratio.

Bishkek positioned its cryptocurrency as the first government-backed stablecoin in the world backed by real gold. The country's leadership pointed out that such a decision would provide new opportunities to strengthen Kyrgyzstan's position in the global financial ecosystem and form the basis for the development of the Web3 infrastructure, an ecosystem of decentralized services that ensure the interaction of the state and the private sector through blockchain solutions.

However, on August 20, the government ordered the liquidation of cryptocurrency management organizations to optimize government participation in business entities and improve the efficiency of state asset management.

Three months before this decision, in May 2026, the UK imposed sanctions on USDKG, accusing it, among other companies, of helping Russia circumvent British sanctions.