Georgia Central Bank Approves Rules for Fiat-Backed Stablecoin Issuance

Georgia’s central bank has set a legal framework for fiat-backed stablecoins, requiring licensed local issuers to hold segregated 1:1 reserves, meet tiered capital thresholds, and redeem users at par within three to five business days.

Summary

Georgia’s central bank established a legal framework for the issuance and circulation of fiat-backed stablecoins. Under the rules, only licensed local companies can issue the tokens, and they must maintain segregated reserves on a 1:1 basis against outstanding stablecoins. Capital requirements begin at 500,000 lari and can rise to 50 million lari, while users must be able to redeem stablecoins at face value within three to five business days.

Terms & Concepts
  • Stablecoin: A cryptocurrency designed to maintain a fixed value, usually by being backed by fiat currency or other reserve assets.
  • Fiat-backed: Describes a digital token supported by reserves of a government-issued currency at a specified ratio, such as 1:1.
  • Segregated reserves: Reserve assets kept separate from an issuer’s own funds to help protect holders and support redemption claims.