Kyrgyzstan tightens crypto-market controls over sanctions risks

Kyrgyzstan is tightening oversight of its crypto-asset sector after sanctions risks moved from a theoretical concern to a direct threat to the country's jurisdiction, Economy and Commerce Minister Bakyt Sydykov said.

Speaking at a meeting of the National Council for the Development of Virtual Assets and Blockchain Technologies at Issyk-Kul, Sydykov said sanctions imposed by the United States, European Union and United Kingdom on Russia had increasingly affected companies and financial organizations in third countries since 2022. More than 25 Kyrgyz companies and individuals are now on sanctions lists, including three virtual-asset service providers that had previously held licenses.

The authorities have launched a platform called Crypto Compliance to monitor the sector. It can check customers, beneficial owners, transactions and crypto wallets for links to illegal activity. Sydykov also said the licenses of two virtual-asset providers, Paybis Gold and InFin, had been terminated. The Cabinet of Ministers has additionally decided to begin liquidating ElPay, the issuer of the KGST stablecoin.

The move follows earlier sanctions involving Kyrgyz crypto businesses. In August 2025, the United States sanctioned Old Vector, a Kyrgyz company that issued the ruble-backed A7A5 stablecoin. The U.S. Treasury said the organization helped create A7A5 with Garantex and other entities, and alleged that the token helped move Garantex customers' funds after sanctions were imposed on the exchange.

The United Kingdom sanctioned Grinex, Old Vector and TengriCoin that same month, linking them to crypto infrastructure around A7A5 and saying it had been used to bypass Western sanctions. British authorities said about $9.3 billion passed through a specialized crypto platform using A7A5 during its first four months. The European Union sanctioned the A7A5 developer, the Kyrgyz token issuer and the platform operator in October 2025, and later added another Kyrgyz structure managing a platform where large volumes of A7A5 were traded.

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Sanctions risks for our jurisdiction have ceased to be theoretical and require constant and strict control.