Turkmenistan Embraces Digital Assets: New Law Aims to Spur Economic Growth and Foreign Investment
Turkmenistan has officially enacted a new law legalizing cryptocurrency mining and exchanges, signaling a strategic move to bolster its economy and attract international capital. The "Law on Virtual Assets," signed by President Serdar Berdimuhamedov, establishes a regulatory framework for digital assets, classifying them strictly as property.
Key Takeaways
- Turkmenistan has legalized cryptocurrency mining and exchanges to stimulate economic development and attract foreign investment.
- The new legislation defines virtual assets as property, not legal tender or securities.
- Both companies and individuals can engage in cryptocurrency mining after registering with the Central Bank.
- Crypto exchanges and custodial services require a license from the central bank and must adhere to strict anti-money laundering regulations.
A New Era for Virtual Assets
The "Law on Virtual Assets" provides a comprehensive legal structure for the creation, use, and exchange of virtual assets within Turkmenistan. This move is anticipated to enhance financial inclusion and offer the legal clarity necessary for attracting digital foreign direct investment, aligning with findings from a 2025 study on Organization of Islamic Cooperation (OIC) member states.
Defining Virtual Assets
Under the new law, virtual assets are categorized as property, distinct from legal tender or securities. They are further divided into two types: secured assets, backed by an underlying asset, and unsecured assets, such as Bitcoin. Importantly, virtual assets cannot be used for the payment of goods or services, reinforcing their role as investment instruments.
Regulations for Mining and Exchanges
Both corporate and individual cryptocurrency miners are now permitted to operate, provided they register with the Central Bank of Turkmenistan. The law mandates adherence to specific technical standards for mining operations and explicitly prohibits illicit practices like cryptojacking. Similarly, crypto exchanges and custodial services must obtain a license from the central bank to operate. The law permits both domestic and foreign entities to own these services, with exceptions for those linked to offshore jurisdictions. All licensed exchanges are required to implement robust know-your-customer (KYC) and anti-money laundering (AML) protocols, disallowing anonymous transactions or wallets.
Economic Outlook
This legislative development positions Turkmenistan to potentially tap into the growing global digital asset market. By providing a regulated environment, the country aims to foster innovation and create new avenues for economic expansion, making it a more attractive destination for international investors in the burgeoning cryptocurrency sector.