There is no small country if its currency is strong, a phrase that resonates with the audacity of El Salvador in adopting bitcoin (BTC) as legal tender in 2021. Now, Kyrgyzstan, a small country nestled in the high mountains of Central Asia, is following an equally ambitious path by launching the gold dollar (USDKG), a stablecoin backed by gold, a proposal that could redefine the role of emerging economies in the future of money.

By the third quarter of 2025, Kyrgyzstan plans to launch its stablecoin, positioning itself as a new player on the digital financial stage. To achieve this, it will use an initial backing of 500 million dollars in gold reserves from the Ministry of Finance and plans to expand them to 2 billion in the near future.

Its plan is to revolutionize cross-border transactions and international trade, starting with Central Asia and looking towards Southeast Asia and the Middle East. But, is this digital gold a nod to the past of the gold standard or a move to create a new version of money in the hands of states in a race for the financial future?

The USDKG, pegged 1:1 to the US dollar, is presented as an option against other alternatives, including bitcoin, to facilitate remittances – which represent 30% of Kyrgyzstan's GDP – and international payments.

It allows users to redeem it for physical gold, other digital currencies, or fiat money, with independent audits to ensure transparency. Gabriel Guerra, project advisor, emphasized at the Token2049 conference in Dubai that “we do not seek to replicate gold prices like other tokens, but to offer stability backed by real reserves.”