Turkmenistan legalises crypto mining and exchanges in shift for economy 

Turkmenistan, one of the world’s most isolated nations, has officially legalised mining and exchanging cryptocurrency in a major shift for the country’s tightly controlled, gas-dependent economy.

President Serdar Berdimuhamedov signed the legislation on Thursday, regulating virtual assets under civil law and establishing a licensing scheme for cryptocurrency exchanges overseen by the country’s central bank.

However, digital currencies will still not be recognised as a means of payment, currency or security.

Turkmenistan, a former Soviet country in Central Asia, relies heavily on the export of its vast natural gas reserves to support its economy.

China is the country’s main importer of gas, and Turkmenistan is currently working on a pipeline to supply gas to Afghanistan, Pakistan and India.

Turkmenistan has been taking steps to digitalise government functions as well as its economy.

In April, it adopted a law introducing electronic visas aimed at simplifying entry for foreigners.

After gaining independence in 1991, the tightly governed nation typically placed strict entry requirements on would-be visitors, with many visa applications turned down for unclear reasons.

A mostly desert country of seven million people with the world’s fourth-largest natural gas reserves, Turkmenistan declared itself officially neutral in 1995 under its first president, Saparmurat Niyazov, who spurned both Western and Russian influence.

Until his death in 2006, Niyazov maintained tight control over politics, a policy of isolationism from the outside world, and an economy heavily based on natural gas exports.

Since succeeding his father as president in 2022, Berdymukhamedov has signalled some opening.

In December, he hinted at possible political reforms ahead of a meeting with Russian President Vladimir Putin, Turkish President Recep Tayyip Erdogan and Iran’s Masoud Pezeshkian.

“We are carrying out extensive work aimed at transforming our neutral country into a powerful, democratic, and rule-of-law state where citizens live happy lives,” Berdymukhamedov said in the article, without giving further details.

While Turkmenistan’s internet remains tightly regulated and controlled by the government, curbs on social media have been eased, and the government has pledged to open new air transport links and liberalise its visa system.

Still, the country is ranked by the Committee to Protect Journalists as one of the worst in the world for independent media.

Kyrgyzstan, another former Soviet Central Asian republic, has also positioned itself as a regional leader in the sector, launching a national stablecoin in partnership with cryptocurrency exchange Binance.