Turkmenistan has approved a sweeping new cryptocurrency law that legalises digital assets but places the industry under tight state supervision, marking a dramatic shift for one of the world’s most closed and authoritarian economies. President Serdar Berdimuhamedov signed the legislation on Nov. 28, according to Business Turkmenistan, setting the framework to take effect in 2026.
The law establishes comprehensive licensing requirements for exchanges and custodians, along with strict know-your-client, anti-money-laundering, and mandatory cold storage rules. It also makes it illegal for banks and credit unions to sell crypto services and gives the government the power to stop, cancel, or impose refunds on token issuances.
State prepares oversight mechanisms and potential permissioned ledgers
Crypto mining and mining pool operations must now register with authorities, with covert activity explicitly prohibited. The law gives Turkmenistan’s central bank the power to approve distributed ledgers or run its own state-controlled network. The law also makes it clear that cryptocurrencies are neither money, currency, nor securities. Instead, it divides digital assets into backed and unbacked categories, with regulators setting rules for liquidity, settlements, and emergency redemptions for backed tokens.
The new framework follows a Nov. 21 government meeting in which Deputy Cabinet Chairman Hojamyrat Geldimyradov presented the legal and technological foundations for integrating digital assets into the country’s economy. His report was accompanied by a proposal to create a dedicated state commission to oversee the sector.
Turkmenistan joins global wave of crypto rule-making
Turkmenistan’s action is part of a larger trend around the world towards more formal rules for digital assets. The UK has proposed tax reforms that would make things easier for DeFi users and shown that they were in line with what the US wanted for stablecoin regulation. At the same time, international groups like the Basel Committees are adjusting how they deal with crypto threats because compliance is different in different parts of the world.
Turkmenistan used to be part of the Soviet Union. It has a lot of gas and an extremely centralised government. In the past, it has had trouble getting to technology and digital communication. But the fact that the government is moving towards a regulated crypto framework means that it thinks there is a strategic value to controlled digital asset uptake. This likely stems from its desire to modernise the economy and ensure government oversight.