Turkmenistan is taking a big step forward by officially permitting crypto exchanges and mining activities, marking a significant change in its financial landscape, even though digital currencies are not yet recognized as legal tender.

New Developments in Turkmenistan’s Crypto Framework

According to recent reports, the government of Turkmenistan has instituted new legislation that legitimizes mining and trading cryptocurrencies. This initiative followed President Serdar Berdymukhamedov’s endorsement of a law which became effective in January, enabling crypto enterprises to begin the registration process.

Situated in Central Asia, Turkmenistan emerged as an independent nation after the collapse of the Soviet Union in 1991. The country is often regarded as highly isolated, facing strict regulations regarding media, internet use, and foreign investments.

With a population exceeding seven million, Turkmenistan’s economy heavily relies on its vast natural gas reserves, ranking fifth globally. Currently, China stands as the primary importer of its gas, and ongoing projects aim to channel natural gas supplies to regions including Afghanistan, Pakistan, and India.

This willingness to adopt cryptocurrency practices signals a remarkable transformation for the country, known for its stringent governance. However, despite permitting mining operations and exchanges, Turkmenistan has yet to classify digital assets as acceptable forms of payment, currency, or legal securities.

Turkmenistan shares this trend in the Central Asian region; for instance, Uzbekistan recently implemented regulations for stablecoin transactions, establishing a regulatory sandbox that is set to launch this January.

Iran is also making waves by proposing to sell military technology for cryptocurrency, as per a Financial Times report. This strategy aims to navigate through international financial sanctions by facilitating arms trades in digital currency.

Current State of the Crypto Market

While regulatory progress is being made across nations, the cryptocurrency market has recently entered a period of consolidation, with Bitcoin’s price hovering without clear direction.

As illustrated in the chart below, Bitcoin has been fluctuating between $85,000 and $90,000 over recent weeks.

This stagnation isn’t only impacting Bitcoin; other cryptocurrencies, or altcoins, are similarly experiencing a lack of momentum. Ethereum has recorded modest gains above 2% over the past month, contrasting with Bitcoin’s slight decline of around 2%.

In the last 24 hours, Bitcoin has attempted to inch toward the higher end of its range, currently trading near $89,500. Given the ongoing trend, it remains uncertain whether this upward movement will gain traction or once again taper off in the days to come.