Kyrguistan, Central Asia country, plans to launch the gold dollar, or USDKG, the stable currency backed by 1: 1 gold with the US dollar in the third quarter, said the project advisor, Gabriel Guerra, to Codendesk at the Token2049 conference in Dubai.
The stable currency, backed by 500 million dollars in gold from the Kyrguistan Ministry of Finance, is designed to facilitate cross -border transfers without problems in a country where remittances represent 30% of GDP.
The Ministry aims to expand gold reserves up to 2,000 million dollars, and it is planned to carry out independent audits to guarantee trust and transparency in collateral support.
Gold has long been considered a highly liquid and without risk reserve. However, their occasional price fluctuations represent a potential risk for the stablecoin stability.
To mitigate this, the stable currency will be overlater, said Guerra, and added that its main case of use would be to move capital through the borders.
“The stable currency will be used in cross -border transactions and international trade, with an initial approach to Central Asia and an expansion to Southeast Asia and the Middle East scheduled for later,” said Guerra.
Keep in mind that USDKG is not designed to replicate gold prices such as USDT or PAXG. On the other hand, it will be backed only by gold reserves and will be issued and redeem in a proportion of 1: 1 with USD, maintaining a stable value directly linked to the global reserve fiduciary currency, widely used in international trade.
USDKG holders can exchange their stable currencies for physical gold and other crypto assets or withdraw them as a fiduciary currency.
