Uzbekistan is introducing a dedicated regulatory framework for stablecoins, establishing a controlled environment for testing and deploying token-based payment solutions.

The new regime is designed to support fintech innovation while maintaining financial stability and regulatory oversight.

Regulatory sandbox for stablecoins

 

The framework operates as a special legal regime (regulatory sandbox) allowing selected participants to implement pilot projects involving:

• issuance of stablecoins backed by fiat currencies;
• use of stablecoins as a means of payment within Uzbekistan;
• cross-border transfers and settlements;
• development of payment systems based on distributed ledger technology (DLT).

Participation is limited to registered entities approved by the authorized body and subject to ongoing supervision.

Strict eligibility and structural limitations

 

The regulation introduces clear boundaries on permissible token models.

Within the special regime, it is prohibited to issue:

• algorithmic stablecoins;
• privacy-enhancing (anonymous) tokens;
• stablecoins backed by crypto-assets.

Only fiat-backed structures are allowed, ensuring alignment with monetary policy and financial stability objectives.

Full reserve requirement

 

Stablecoins must be fully backed by funds:

• reserves must be held in national or foreign currency;
• funds must be placed on a segregated account at the Central Bank;
• reserves must at all times match or exceed the total value of tokens in circulation.

Importantly:

• reserves cannot be used for other obligations of the issuer;
• borrowed or leveraged funds cannot be used as backing.

This establishes a strict 1:1 reserve model.

Registration and supervision of participants

 

Entities must undergo a formal registration process to participate in the regime.

The framework provides for:

• inclusion in a public register of participants;
• ongoing monitoring by the authorized body;
• mandatory reporting obligations.

Participants may operate without additional licensing for crypto activities within the sandbox, subject to compliance with the regime’s conditions.

Governance and risk controls

 

The regulation imposes robust governance requirements:

• disclosure through a White Paper;
• identification of ultimate beneficial owners;
• restrictions on individuals with criminal or high-risk backgrounds.

In addition, projects must:

• define operational limits (clients, transaction volumes, risks);
• implement mechanisms for dispute resolution and customer protection;
• ensure transparency of business models and financial flows.

Cybersecurity and operational resilience

 

A strong emphasis is placed on IT and cybersecurity requirements.

Participants must:

• implement multi-factor authentication and secure key management;
• ensure system resilience and data protection;
• maintain backup and recovery systems;
• appoint responsible officers for information security.

Incidents affecting token issuance or circulation must be reported within strict timelines to regulators.

Pilot duration and regulatory outcome

 

Pilot projects are initially approved for 12 months, with possible extensions.

However:

• the total duration cannot exceed 3 years;
• based on results, authorities may: integrate the model into permanent legislation; or terminate the project.

This confirms the sandbox nature of the regime as a policy-testing tool.

Implications

 

The framework creates a structured entry point into the digital asset space:

• fintech companies gain access to a regulated testing environment;
• investors benefit from clearer safeguards and transparency;
• regulators retain tight control over risks and systemic impact;
• the market moves toward compliant, fiat-backed tokenization models.