Turkmenistan, a country known for its strict controls and an economy heavily dependent on natural gas, has now officially opened its doors to cryptocurrency mining and exchanges.
President Serdar Berdimuhamedov signed a new law regulating digital assets under a civil law framework and introduced a licensing system for crypto exchanges under the supervision of the central bank.
However, digital currencies are still not recognized as means of payment, legal tender, or securities. This shows that Turkmenistan wants to take advantage of crypto technology without sacrificing full control over its financial system.
As a former Soviet country in Central Asia, Turkmenistan relies heavily on natural gas exports as the backbone of their economy. China is a major buyer of their gas, while the country is building a network of pipelines to deliver gas to Afghanistan, Pakistan, and India.
In addition to focusing on energy resources, Turkmenistan is also working to modernize its administration and economy through digitalization.
For example, in April, it introduced an electronic visa system to ease the entry of foreigners, a step in stark contrast to a history of tight border closures since independence in 1991.
The desert nation of about seven million people holds the world’s fourth-largest natural gas reserves and declared itself neutral since 1995 under the rule of Saparmurat Niyazov. Niyazov maintained a strict isolationist policy and rejected Western and Russian influence until his death in 2006.
President Berdimuhamedov recently hinted at possible political reforms, notably after meetings with the leaders of Russia, Turkey and Iran. However, details remain sketchy and tightly controlled.
While the internet in Turkmenistan remains tightly controlled, there has been a relaxation of social media use and promises to open air routes and liberalize the visa system. However, press freedom remains among the worst in the world, according to the Committee to Protect Journalists.
Turkmenistan’s move to recognize and regulate cryptocurrencies is a stark paradox: it wants to harness new technology without loosening its grip on authoritarian control. This reflects the dilemma of a country struggling to emerge from the shadow of the gas economy without sacrificing political power.
