In a world where digital currencies are evolving from niche hobbies into mainstream financial instruments, many entrepreneurs are asking a simple question: is it legal to work with cryptocurrency in Kyrgyzstan? Can a sole proprietor (IE) or limited liability company (LLC) accept payment in Bitcoin or USDT for goods and services?
Based on the Law of the Kyrgyz Republic “On Virtual Assets” (2022) and its 2025 amendments, as well as our consulting experience with small businesses across Central Asia, this article explains what’s really possible. It draws on official sources such as the Financial Market Supervision and Regulation Service (FinSupervision) and the National Bank of the Kyrgyz Republic (NBKR).
Cryptocurrency in Kyrgyzstan: What the Law Says
Kyrgyzstan is one of the pioneers in regulating virtual assets (VA) among CIS countries. The Law No. 12 “On Virtual Assets”, adopted in January 2022 and updated in 2025, defines cryptocurrency as a digital asset — but imposes strict limits on its use.
Key point: Virtual assets are not a legal means of payment within the Republic. This means that neither an IE nor an LLC can directly use crypto to pay for goods, services, or business transactions. Such operations are treated as the use of illegal payment instruments, comparable to counterfeit money.
In our practice, we’ve seen enthusiasts attempt to bypass this rule through informal channels, but FinSupervision actively monitors and penalizes such activity. Fines range from 50,000 to 500,000 KGS for legal entities, along with potential account suspension.
However, the door isn’t completely closed — businesses can still engage in crypto indirectly, through licensed operators.
Direct Crypto Payments: Only with a Crypto License
Can your IE or LLC accept cryptocurrency in Kyrgyzstan from clients? The short answer is yes — but only if you hold a crypto license as a Virtual Asset Service Provider (VASP).
Without such a license, any crypto transaction to a corporate wallet will be considered an illegal exchange or custody operation, potentially punishable under Article 204 of the Criminal Code (illegal turnover of financial instruments).
As of 2025, the issuance of new crypto licenses has slowed: FinSupervision tightened controls after several money-laundering scandals in 2024. By July 2025, only 13 licenses for trading operators (crypto exchanges) and 186 for exchange operators had been issued — mostly renewals.
New entrants face challenges: priority goes to large, compliant players with international backgrounds. According to an NBKR representative we spoke with earlier this year, the focus now is on compliance, not mass licensing.
For individual entrepreneurs, it’s even harder — the license requires a registered legal entity (LLC or higher). Many therefore convert their IE into an LLC to qualify. The benefits? A licensed business can legally exchange crypto for KGS, store digital assets, or even offer staking services — but only for clients, not for internal settlements.
Good news for foreign founders: it’s possible to open an LLC in Kyrgyzstan remotely without visiting the country.
How to Obtain a Crypto License: Step-by-Step
Getting a crypto license is far from “one click.” It’s a regulated, multi-stage process under the Regulation on Virtual Asset Exchange Operators (Decree No. 514 of 2022, as amended in 2025).
Here are the main requirements, based on FinSupervision’s official documents:
- Registration & structure: The company (LLC) must be registered in Kyrgyzstan with a real legal address. At least two directors are required, one of whom must be a Kyrgyz resident.
Minimum charter capital:- Exchange operators — 40 million KGS (~$450,000)
- Trading operators (crypto exchanges) — 10 billion KGS (~$114 million)
- Technical base: Servers located in Kyrgyzstan or under local control, with two-factor authentication. Mandatory KYC/AML compliance, including identity verification and transaction monitoring. Transactions above 100,000 KGS must be reported to FinSupervision.
- Documents & audit: A 3-year business plan, API documentation, ISO 27001 security certificates, and an audit by an accredited legal firm (starting from 500,000 KGS). Founders must have no prior financial convictions.
Applications are submitted online via fsa.gov.kg.
Processing takes 30–60 days, and the state fee is 100,000 KGS.
The approval rate is estimated at around 20%, based on industry feedback.
If approved, the license is permanent, but requires annual auditing and compliance checks.
Receiving Funds Legally: From Crypto to Fiat
What if your business doesn’t accept crypto directly — can you still get paid?
Yes — and this is the main legal pathway for businesses in 2025.
The process is simple:
A client sends cryptocurrency to a licensed exchange platform, which converts it into KGS and transfers the fiat amount to your company bank account (for example, at Optima Bank or Kyrgyzkommerzbank).
The key is a formal service contract with a licensed exchange operator. Without it, transfers may be blocked as suspicious. These platforms must appear in the official registry of licensed operators maintained by FinSupervision.
Registries:
As of August 2025, there were 186 exchange operators (including TuZeMun) and 13 trading operators (Jakshy Zaman and others).
Commissions typically range from 1–3%, plus bank transfer fees. In our consulting experience, this model saved several IT startups: they integrated an exchange API, allowing clients to pay in crypto via an intermediary — legally and transparently.
However, remember: all such transactions must be declared to the State Tax Service (STS) for taxation.
Taxes and Risks: What Happens After Conversion
Payments converted through licensed exchanges are taxed as follows:
- Income Tax (IE): 10% on net profit
- Corporate Tax (LLC): 10% on profit
- VAT: 12% on exchange services
- Simplified regime (Unified Tax): from 2% to 6% depending on turnover
Mining and crypto custody operations are subject to separate quarterly reporting.
Risks: high volatility (Bitcoin may drop 20% in a day), wallet hacks, and tightening regulation — in 2025, the NBKR introduced a 1 million KGS transfer limit without full verification.
Opportunity with Caution
In Kyrgyzstan, working with cryptocurrency is not forbidden — it’s regulated. IE and LLC owners can legally engage with crypto, but only through licensed intermediaries.
Direct acceptance remains rare due to licensing barriers, but indirect transfers via exchanges open doors for international clients.
If you’re in IT, e-commerce, or freelancing, crypto payments can double your reach — but proceed carefully.
Stay compliant, monitor fsa.gov.kg, and when in doubt, consult professionals.
Our team at KGAccount can assist you with financial licenses, compliance audits, and tax reporting for crypto-related operations.
In short: compliance today — profit tomorrow.
Sources
- Law of the Kyrgyz Republic “On Virtual Assets” (No. 12, 2022)
- National Bank of the Kyrgyz Republic (NBKR)
- OECD – Taxation and Digital Assets
- PwC Global Crypto Regulation Report 2025