Legal Regulation of Virtual Assets in the Kyrgyz Republic: Current Status and Key Trends

In recent years, the Kyrgyz Republic has been consistently developing a legal framework for the regulation of virtual asset circulation. Unlike many jurisdictions in the region, Kyrgyzstan has opted not for prohibitions, but for the institutionalization of the crypto market, the introduction of licensing and state supervision, and the integration of digital assets into the existing financial system.

This overview reflects the current state of crypto regulation in the Kyrgyz Republic and may be useful for investors, fintech projects, crypto platforms, and financial institutions considering Kyrgyzstan as a jurisdiction for conducting business.

Evolution of Legal Regulation of Virtual Assets

Period prior to 2022

Before the adoption of specialized legislation, virtual assets existed in a legal “gray zone.” Their circulation was not expressly prohibited; however, it was not regulated by specific legal provisions either. In practice, general provisions of civil, tax, banking, and currency legislation were applied. At the same time, there was no formally established legal status of virtual assets, no requirements for crypto exchanges and exchange platforms, no licensing regime, and no systematic state supervision.

Period After 2022 - Establishment of a Special Legal Regime

The situation fundamentally changed following the adoption of the Law of the Kyrgyz Republic “On Virtual Assets,” as well as Resolution No. 514 of the Cabinet of Ministers of the Kyrgyz Republic dated September 16, 2022 (hereinafter – the “Law”).

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Authors:

Aisanat Safarbek kyzy, Partner
Aibek Shamurzaev, Associate
Akzyinat Tashieva, Associate