Turkmenistan has enacted a new law imposing sweeping state control over cryptocurrency activities, signaling a tightly managed entry into the digital asset realm for one of the world’s most insular nations.
The legislation, signed by President Serdar Berdimuhamedov, is set to take effect in 2026.
It mandates strict licensing requirements, Know Your Customer (KYC) protocols, and Anti-Money Laundering (AML) policies for all cryptocurrency exchanges and mining operations. The state reserves the power to halt new token emissions and compel the return of funds.
Cryptocurrencies will not be recognized as legal tender, national currency, or securities within the country. Financial institutions are expressly forbidden from offering any services related to digital assets.
All cryptocurrency mining, including mining pool operations, must be formally registered. Covert or unregistered operations will be considered illegal.
The Central Bank of Turkmenistan may authorize or even operate its own distributed ledger technology system. This could potentially compel citizens to use government-approved and monitored digital infrastructures.
Local media outlet Business Turkmenistan reported that President Berdimuhamedov officially signed the new regulation on November 28.
The law also stipulates requirements for cold storage for custodial services and introduces a classification system for digital assets as either backed or unbacked. The government will establish specific criteria for demonstrating the liquidity of backed assets, along with settlement conditions and emergency redemption mechanisms.
This legislative move followed a November 21 meeting where Hojamyrat Geldimyradov, Vice Chairman of the Cabinet of Ministers, presented a report on introducing digital assets. That report outlined the “legal, technological, and organizational foundations” for the sector’s development and proposed creating a “Special State Commission” to oversee the crypto industry.
This approach underscores the Turkmen government’s intent to maintain full digital sovereignty and control over a new economic sector. It aims to prevent the free circulation of digital assets without strict state supervision.
The planned implementation for 2026 provides the state with ample time to consolidate the necessary surveillance mechanisms, infrastructure, and supervisory frameworks. These will accompany the growth of the cryptocurrency industry within the nation’s borders.
Turkmenistan’s regulatory development aligns with a broader international trend toward more comprehensive frameworks for cryptocurrencies and stablecoins. Governments and central banks worldwide are accelerating efforts to establish clear rules for these emerging assets.
Globally, the push for clearer regulation includes proposals like the United Kingdom’s tax authority considering reduced tax burdens for decentralized finance users. The Bank of England’s Deputy Governor, Sarah Breeden, has indicated the UK expects to keep pace with the United States on stablecoin regulation. Erik Thedéen, Governor of Sweden’s central bank and chair of the Basel Committee on Banking Supervision, has acknowledged the need for a revised approach to high-risk weightings for crypto exposures.