Kyrgyzstan, country of Central Asia, plans to launch Gold Dollar, or USDKG, the stablecoin backed by gold and indexed 1: 1 on the US dollar in the third quarter, said project advisor Gabriel Guerra in Coindesk at the Token2049 conference in Dubai.
Stablecoin, supported by $ 500 million in gold from the Kyrgyz Ministry of Finance, is designed to facilitate fluid cross -border transfers in a country where fund transfers represent 30 % of GDP.
The ministry aims to increase gold reserves up to $ 2 billion, with independent audits planned to guarantee confidence and transparency in collateral support.
Gold has long been considered a reserve of highly liquid and risk -free value. However, its occasional price fluctuations represent a potential risk for the stability of the stablecoin.
-To alleviate this problem, the stablecoin will be overdoors, noted Guerra, adding that its main use case would be the movement of capital through borders.
“The stablecoin will be used in cross-border transactions and international trade, with an initial accent on Central Asia and an expansion in Southeast Asia and in the Middle East later,” said Guerra.
Note that the USDKG is not intended to take the course of gold like USDT or the PAXG. It will only be backed by gold reserves and issued and bought on a basis of 1: 1 with the US dollar, now a stable value directly linked to the global reserve currency widely used in international trade.
USDKG holders can exchange their stable parts for physical gold and other crypto assets or remove them in the form of fiduciary currency.
