Kyrgyzstan has ordered the liquidation of EVA, the issuer its gold-backed USDKG stablecoin, along with Coin Nomad Exchange, the country’s state-owned crypto exchange, less than a year after the token launched. The move stands out because most stablecoins are issued by companies rather than governments, making USDKG’s ministry-owned structure unusual in the sector.

The official USDKG website (usdkg.com) said the project is being terminated under Cabinet of Ministers Order No. 639-t, dated Aug. 20. The closure applies to the project’s activities on blockchain networks. The order said the measures were intended to improve state participation in commercial companies and strengthen the management of state assets.

According to local outlet Akchabar, the order instructed the Finance Ministry to liquidate OJSC EVA (OJSC stands for open joint-stock company, a corporate form common in post-Soviet jurisdictions), the renamed USDKG issuer, and OJSC Coin Nomad Exchange. USDKG itself is not named in the order.

Wu Blockchain reported the decision on X:

Kyrgyzstan Ends State-Backed Stablecoin Project Months After UK Sanctions

USDKG holders can email hello@usdkg.com to exchange their tokens for fiat money or USDT, Tether’s dollar-pegged token and the largest stablecoin by circulation. The notice does not specify a deadline, identify the fiat currencies available for redemption or explain the required verification procedures.

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. It initially launched on Tron, with Ethereum support added later — two of the most widely used blockchains for dollar-pegged tokens.

A review by Kreston Global found that the token was backed by 30 gold bars weighing approximately 376 kilograms. The gold was valued at $50.3 million, enough to cover the first 50 million tokens. Gold collateral set USDKG apart from the largest dollar stablecoins, which hold reserves composed primarily of cash and short-dated U.S. Treasury bills.

At the time of checking, CoinGecko showed USDKG trading at approximately $1.00, with 50 million tokens listed in circulation. Its 24-hour trading volume was about $22,955 across Uniswap V3 and Curve. It remains unclear how many tokens will be redeemed during the liquidation.

UK Sanctions on the Issuer

The United Kingdom sanctioned the issuer, then known as OJSC Virtual Asset Issuer, on May 26 under its Russia sanctions program. The UK said there were “reasonable grounds to suspect” that the company had supported or benefited from Russia’s government.

The measures included an asset freeze, restrictions on trust services, director disqualification and internet-services sanctions. Under the UK regime, an asset freeze bars UK persons from dealing with a designated entity’s funds or making funds available to it. The notice did not say that USDKG had been used to process sanctions-evasion payments. The UK sanctions listing is available here.

Two days later, the company was re-registered as OJSC EVA, Akchabar reported. No official explanation has been given for the name change.

The sanctions also affected USDKG trading. OSL HK listed the token for professional investors on May 21, then stopped all USDKG services on May 27.

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

Separately, the U.S. Treasury designated the Russia-linked A7 Network as a transnational criminal organization on Oct. 1. That action did not name USDKG or EVA.

Coin Nomad’s liquidation notice gave creditors one month from Sept. 14 to submit claims. The claims window closes around Oct. 14, 2026, while USDKG redemption requests still have no final deadline.

Original report