Kyrgyzstan shuts $50M USDKG stablecoin after UK sanctions

What happened

Kyrgyzstan has closed its gold-backed USDKG stablecoin less than a year after the $50 million launch. The government ordered the liquidation of the token's issuer, EVA, and of state-owned Coin Nomad Exchange. Local outlet Akchabar reported that the Finance Ministry was told to wind up both companies.

The project's website said USDKG is ending under Cabinet of Ministers Order No. 639-t, dated Aug. 20, including its activities on blockchain networks. The order said the measures were adopted to optimize state participation in commercial companies and improve management of state assets. Akchabar reported that USDKG is not named directly in the order, while the project's own site links the order to the end of USDKG operations.

Holders can contact [email protected] to exchange USDKG for fiat money or USDT. The notice gives no redemption deadline, does not state which fiat currencies are available and sets out no detailed verification requirements. Coin Nomad began voluntary liquidation in September, giving creditors one month to submit claims.

Why it matters

The closure follows UK sanctions. Britain's Foreign, Commonwealth & Development Office designated OJSC Virtual Asset Issuer on May 26 under its Russia sanctions regime, and the USDKG name and USDKG.com website appeared in the formal notice. Measures included an asset freeze, trust-services limits, director disqualification and internet-services sanctions. The notice did not say USDKG was used to process sanctions-evasion payments.

The UK said there were reasonable grounds to suspect the company had supported or obtained a benefit from Russia's government. Trading access changed quickly: OSL HK listed USDKG for professional investors on May 21, then stopped all USDKG services on May 27. Two days after the sanctions, the company was re-registered as OJSC EVA, and no official reason has been given for the name change.

Redemption is the open question for holders. The project offers swaps by email, but it has published no deadline and no list of available fiat currencies. It is not clear how many of the listed tokens will be redeemed during the liquidation. Separately, the U.S. Treasury designated the Russia-linked A7 Network on Oct. 1, and that action did not name USDKG or EVA.

What the data shows

A review published after the launch said Kreston Global inspected 30 gold bars weighing approximately 376 kilograms. The reserves were valued at $50.3 million using Nov. 28, 2025, LBMA pricing and were reported as sufficient to cover the first 50 million USDKG tokens.

CoinGecko still showed 50 million USDKG listed as circulating and the token trading near $1. The same listing put 24-hour trading volume near $22,955 on Uniswap V3 and Curve.

Background

USDKG entered circulation in November 2025. The token was pegged 1:1 to the U.S. dollar and issued by a company owned by Kyrgyzstan's Ministry of Finance. The first deployment used Tron, with Ethereum support introduced later.

Coin Nomad Exchange was registered in December 2024. Its sole shareholder, the Finance Ministry, approved voluntary liquidation on Sept. 3. Akchabar reported that the exchange posted a net profit of 1.47 million Kyrgyz soms in the first half of 2026, although its operating business made a loss and it was behind on some tax payments.

What is still unclear

• It is not clear how many of those tokens will be redeemed during the liquidation.
• The redemption notice sets out no deadline, no list of available fiat currencies and no detailed verification requirements.
• No official reason has been given for the change of name to OJSC EVA.

What to watch

• 2026-10-14 Coin Nomad's liquidation notice gave creditors one month from Sept. 14 to file claims, a window that closes around Oct. 14, 2026. USDKG redemption requests still have no final date.

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