Indicating the increasing adoption of digital assets in Asia, Kyrgyzstan is on the verge of creating a state-owned cryptocurrency reserve. The country’s parliament announced on Wednesday through an official statement.
As revealed, lawmakers in the country have approved amendments to the “On virtual assets” through three simultaneous readings. While the newly approved laws underline the support for the growth of the virtual assets space, they allow Kyrgyzstan to set up a strategic crypto reserve.
Likewise, the statement established how the Central Asian country is gearing up to venture into crypto mining. More so, Bakyt Sydykov, the Kyrgyzstan minister for Economy and Commerce presented the bill before the lawmakers.
Kyrgyzstan targets stablecoins and RWAs
It addresses key components of the country’s cryptocurrency market including the introduction of a legal framework for the issuance and distribution of stablecoins and tokenized real-world assets (RWAs). Currently, tokenized RWAs are dominating headlines as they pave the way for institutional investors to gain more exposure to the cryptocurrency market.
According to DeFiLlama, the RWAs are worth $15.8 billion as of press time which is a significant growth compared to how its total value locked is just $654 million in December 2022. Kyrgyzstan understands that tokenized assets are one of the hottest niches in the digital assets space in recent times and the country aims to dive into its fast-growing pace.
Similarly, the country taps into the emerging trend as governments across the globe are embracing stablecoins to provide an inclusive financial system. By that, the minister indicated that Kyrgyzstan plans to address the issuance of stablecoins, setting supportive guidelines to make the industry flourish.
Sydykov added that a state-backed cryptocurrency reserve would help improve financial stability in the Asian country by diversifying and adopting new investment instruments. Despite establishing that Kyrgyzstan is eyeing crypto mining, the minister added that the government will not be exempt from paying standard energy rates.
Furthermore, Sydykov made this declaration in reaction to emerging concerns about the country’s electricity supply in regards to crypto mining. While there are rumors that the government may set up a mining farm at the thermal power plant, the minister stated that the move will not materialize.