Kyrgyzstan President Sadir Japarov on Thursday took a step closer to issuing digital currency from his central bank and signed a law that grants the legal status of “digital soms.”
The Central Asian country is still deciding whether to issue CBDCs, but an amendment to the Kyrgyz Republic law on Thursday guarantees that digital SOMs will be treated as fiat currency once the central bank advances issuing CBDCs.
“The purpose of the constitution is to launch a pilot project for the prototype of the national digital currency, “Digital SOM,” and create a legal basis and its status,” a statement from the president's site said.
Under the new regulations, the National Bank of Kyrgyzstan can develop and approve rules for implementing payments on digital SOM platforms.
These provisions were described as amendments to the President's website and were first adopted on March 20 by the Supreme Council of Kyrgyzstan. The country is set to begin testing digital SOM this year, according to local news outlet trends news. The country is not expected to make a final decision on whether to issue CBDCs until next year.
The idea for the CBDC has been controversial among several cryptographers, but countries like the UK, Nigeria, Jamaica, the Bahamas, and the multinational bloc of the European Union have moved towards issuing CBDCs, while other countries like the US have mostly moved out of ISS ideas.
