Kyrgyzstan has taken a major step toward becoming a regional leader in digital finance, passing a bill that introduces the concept of a state-owned cryptocurrency reserve. Lawmakers approved amendments to the “On Virtual Assets” law in three readings, adding legal definitions for “state crypto reserve” and “state mining,” according to the country’s parliament.

The bill, presented by Economy and Commerce Minister Bakyt Sydykov, creates a legal framework for the issuance and circulation of stablecoins, tokenized real-world assets, and state-run mining operations. The initiative aims to diversify Kyrgyzstan’s financial system and strengthen stability by giving the government new tools for asset accumulation in digital form.

Sydykov explained that the reserve would be built through state mining, tokenization of physical assets, and the creation of stablecoins backed by fiat. He stressed that the government will not receive special treatment on electricity pricing for mining, addressing concerns over the nation’s energy supply. “There is a separate tariff for mining in the country, and the state is no exception,” he said.

The crypto reserve will not be limited to Bitcoin or traditional cryptocurrencies but will include a mix of assets under direct state ownership. “A state cryptocurrency reserve is a set of virtual assets owned by the state and formed through mining, issuance, tokenization, and acquisition,” the bill states. Its management and usage procedures will be defined by President Sadyr Japarov, who is expected to sign the legislation.

The move comes just months after Japarov approved a law on central bank digital currency (CBDC). Neighboring Kazakhstan is also exploring a state-backed crypto reserve, with President Kassym-Jomart Tokayev urging stronger development of crypto and artificial intelligence. Kyrgyzstan’s latest bill signals Central Asia’s growing race to build state-controlled digital economies.