Turan Research Center

The Organization of Turkic States (OTS) is meeting more often, its summits attracting more attention, and Recep Tayyip Erdogan is invoking Pan-Turkic imagery with increasing frequency. Against this backdrop, academic and policy debate over Pan-Turkism and Turanism has revived — and the two terms are routinely conflated.

They are not the same. Tracing their separate intellectual histories clarifies what is actually at stake in the current moment, and what is not.

The Genesis of Pan-Turkism: The Age of Pan-Ideologies

Pan-Turkism did not emerge in isolation. The late 19th and early 20th centuries produced a wave of transnational ideological projects, of which Marxism was only the most ambitious. Pan-Americanism promoted hemispheric integration under U.S. influence. Pan-Germanism shaped the political imagination of the German and Austro-Hungarian spheres. Pan-Slavism, alongside currents such as Slavophilism, became central both to imperial Russian policy and to the strategic anxieties of its rivals.

Within this environment, Ottoman intellectuals — often educated in European institutions yet rooted in Islamic traditions — searched for an ideological response to imperial decline. Facing fiscal crisis, territorial fragmentation, and mounting external pressure, they sought a unifying doctrine to consolidate a disintegrating political order. Observing how rival powers leveraged "Pan-ideologies" to reinforce state cohesion, segments of the Ottoman elite formulated a parallel response.

Historical precedents appeared compelling. Pan-Italian sentiment had contributed to the unification of Italy in 1870. Pan-Germanism had strengthened Prussian dominance, culminating in the German Empire and the elevation of the Prussian king to Kaiser. Inspired in part by movements such as "Young Italy," the Young Turks envisioned a similar framework for the Ottoman context. They expected such an ideology to consolidate society around the ruling elite and the Sultan, stimulate economic and military modernization, and elevate the monarchy to a status comparable to contemporary European emperors.

A successful Pan-Turkic project also promised to extend Ottoman influence into the Caucasus and Central Asia. But the rise of Turkish nationalism deepened internal fractures, alienating non-Turkish populations — most notably Arabs and Armenians. By the early 20th century, parallel nationalist movements had emerged in response, including the Arab intellectual circles that would later contribute to Arab nationalism. Among the most significant was Al-Fatat ("Young Arab Society"), founded in 1909 by Arab students in Paris — one of the earliest organized expressions of modern Arab nationalist thought.

Turanism vs. Pan-Turkism: A Conceptual Distinction

Turanism did not originate within Ottoman political thought. It was introduced by Matthias Alexander Castrén, a scholar of Finno-Ugric and Siberian languages working within the intellectual framework of the Russian Empire. Observing the mobilizing power of Pan-Slavism, Castrén proposed a broader civilizational grouping that extended beyond Turkic peoples.

In its original formulation, Turanism encompassed Hungarians, Finns, Estonians, Ugric groups, Tungusic peoples, Mongols, and Turks. This expansive vision was institutionalized in organizations such as the Turan Society, founded in Budapest in 1910 under Pál Teleki, which promoted the idea of a transcontinental "Turan" stretching from Europe to East Asia.

Ziya Gökalp, the principal theorist of Turkism and Turanism within the Ottoman context, rejected this civilizational scope. In The Principles of Turkism, he confined the concept of Turan strictly to Turkic peoples, excluding groups such as Hungarians and Finns.

The divergence between a broad, civilizational Turanism and a narrower, ethnolinguistic Pan-Turkism lies at the root of much of the contemporary confusion surrounding the terms.

The Interwar Period and the Nazi Shadow

The interwar years forced a retreat into pragmatism. Both Mustafa Kemal Atatürk and Hungarian Admiral Miklós Horthy understood the dangers of ideological adventurism. Atatürk focused on building "state nationalism" within republican borders, avoiding any provocation of the Soviet Union.

Admiral Miklós Horthy also approached Turanist circles pragmatically. Although Turanist organizations were not banned outright, as many radical movements were, the Horthy regime kept them within carefully controlled limits to prevent them from developing into autonomous political forces capable of challenging state authority. Instead, Turanist networks were selectively utilized as informal instruments of Hungarian foreign policy and trade diplomacy, particularly in cultivating relations with Kemalist Turkey and Imperial Japan during the interwar period.

Leadership of the radical nationalist wing in Turkey gravitated toward figures such as Nihal Atsız, an ideologue of Pan-Turkism whose writings promoted an exclusionary, racialized vision of Turkish identity. His work identified communists, Jews, Persians, and Russians as civilizational enemies, reflecting the broader climate of extremist nationalism in the period.

A comparable strain of rhetoric appeared in Iraq through figures like Khairallah Talfah, the maternal uncle and early mentor of Saddam Hussein. Talfah authored the pamphlet Three Whom God Should Not Have Created: Persians, Jews, and Flies, often cited as indicative of the ideological currents shaping Saddam's formative years.

Meanwhile, Nuri Killigil — commonly known as Nuri Pasha and the half-brother of Enver Pasha — served as the commander of the Islamic Army of the Caucasus and fought against Bolshevik forces during the collapse of the Russian Empire and the wider turmoil of the post-World War I period. After the consolidation of Atatürk’s rule, Nuri Pasha spent extended periods abroad, including in Germany, before eventually returning to Turkey prior to the Second World War.

During the Second World War, he established an arms and steel production enterprise, and maintained contacts with Nazi Germany. In historical literature, he is often associated with facilitating links between German authorities and Turkic populations from the Soviet Union, including formations such as the Turkestan Legion.

The turning point came in 1944. Following the German defeat at Stalingrad, Ankara reassessed the risks of alignment with pro-German and radical nationalist circles. Concerned that such currents could provoke Soviet pressure or even intervention, the Turkish government moved against them. The 1944–45 Racism–Turanism Trials produced arrests and prosecutions of prominent Pan-Turkist figures — Nihal Atsız among them. Many convictions were later overturned on appeal.

The Cold War and the Post-Soviet Opening

After the Second World War, Turkey could not afford a transnational ideological project of this kind. Hungary, absorbed into the Soviet bloc, underwent repressive campaigns comparable in scale and method to Stalinist purges. Under one-party communist consolidation, Turanist ideas were eliminated from public and political life. Educational institutions, media, and political structures were reduced to instruments of communist propaganda.

In Turkey, under Kemalist leadership during the Cold War, Pan-Turkist circles — particularly those associated with the Grey Wolves — were confined to the domestic arena. Turkish intelligence, military elites, and political leadership initially marginalized these groups, then selectively co-opted them as instruments against leftist and communist opposition. They were deployed in street confrontations and in suppressing student unrest. During periods of series military coup d'etat, the Grey Wolves functioned as an auxiliary ideological and operational extension of the security apparatus. They were not permitted to engage in any meaningful cross-border activity.

Even within the nationalist tradition, the strategic limits of Pan-Turkism were openly acknowledged. Alparslan Türkeş, founder of the MHP and the Grey Wolves, framed the doctrine in self-restraining terms — affirming the right of every Turk to wish for the liberation of Turks under foreign rule, but insisting that it was "essential to be realistic in our nationalism and to be on a path that will never lead Turkey into dangers." Pan-Turkism in its mainstream Turkish articulation, even at its most ideologically charged, was never a project to redraw borders.

The configuration began to shift only after the collapse of the Soviet Union. Pan-Turkist networks, including affiliates of the Grey Wolves, re-emerged in Azerbaijan, where they experienced a brief resurgence. Their sympathizers, led by Abulfaz Elchibey, came to power and attempted to translate Pan-Turkist rhetoric into state policy. The phase proved short-lived. Azerbaijan's defeat in the war with Armenia over Nagorno-Karabakh, along with the loss of surrounding territories, undermined Elchibey's authority and pushed the country into political instability. Elchibey's Pan-Turkist positions also strained relations with Iran and with regional partners such as Uzbekistan under Islam Karimov, particularly after Azerbaijan granted refuge to Karimov's political opponents.

After the collapse of the Soviet Union, Azerbaijan’s defeat in the First Nagorno-Karabakh War and the adoption of Section 907 of the U.S. Freedom Support Act — which significantly limited direct American assistance to Baku amid the influence of Armenian lobbying efforts in Washington — created a deep sense of geopolitical isolation within the Azerbaijani leadership. In this context, then-President Heydar Aliyev revived and institutionalized the concept of “One Nation, Two States,” a doctrine asserting that Turks and Azerbaijanis, despite being separated by historical and political developments into different state structures, belong to the same broader ethnocultural community.

However, two important historical clarifications should be made.

First, the intellectual foundations of the concept can be traced back to Mammad Amin Rasulzade, the founding figure of the Azerbaijan Democratic Republic. Rasulzade articulated similar ideas earlier in his work “The Siyavush of Our Time”(Əsrimizin Siyavuşu), written during his period of political exile following the Bolshevik takeover of Azerbaijan.

Second, the historical separation between Anatolian Turks and Azerbaijani Turks did not emerge solely because of external imperial interventions or arbitrary geopolitical divisions. It was also shaped by the fact that various Turkic dynasties and ruling elites historically pursued distinct imperial projects and competing state traditions, which frequently brought them into military confrontation with one another, even when Turkic languages were widely used in administration and court culture.

The Safavid dynasty, Afshar dynasty, Qajar dynasty, Ottoman Empire, Shaybanid dynasty, Timurid Empire, and Mughal Empire all possessed Turkic political or dynastic roots to varying degrees, yet each developed its own imperial identity, geopolitical ambitions, and model of state-building — often through violent processes of expansion and integration.

For this reason, Rasulzade’s choice of the title “The Siyavush of Our Time” carried deep symbolic meaning. Siyavush, a central figure in Shahnameh, was born of a Turanian mother and an Iranian father, embodying a dual and conflicted identity. Rasulzade used this metaphor to describe the complex identity of Azerbaijani Turks in the early twentieth century, situated historically and culturally between the worlds of Turan and Iran. He viewed strategic alignment with Anatolian Turks as one possible avenue for political survival.

Heydar Aliyev’s later revival of the “One Nation, Two States” doctrine in the 1990s likewise reflected a survival strategy under difficult geopolitical circumstances. Following military defeat and diplomatic isolation, Azerbaijan sought a reliable strategic partner capable of assisting in the creation of a new national army, officer corps, and military aviation infrastructure. Azerbaijani access to Russian military institutions became increasingly constrained politically in the early 1990s, while Turkey emerged as the principal external actor willing and able to support the restructuring and modernization of Azerbaijani armed forces.

The same period saw a much wider Turkish push into Central Asia. Ankara was the first to recognize the independence of the new Turkic republics. Under President Turgut Özal, more than 1,170 official delegations visited the region in the first year of independence, and over 140 bilateral cooperation agreements were signed by 1993. Özal himself died that year after an exhausting diplomatic tour of Central Asia. His successor, Süleyman Demirel, articulated the ambition in geographic terms, speaking of a Turkic world stretching "from the Adriatic to the Great Wall of China."

The response from Central Asian capitals was cautious from the outset. Having only just emerged from Moscow's tutelage, Tashkent, Astana, Ashgabat, and Bishkek had no appetite to substitute a Russian "elder brother" for a Turkish one. Cultural and linguistic affinities did not translate into political deference. Pan-Turkist parties in Kazakhstan and Uzbekistan remained marginal; Turkey's mid-1990s political instability and currency crisis hardened regional skepticism. Within Turkey itself, Pan-Turkism never emerged from its marginal position. Society and the political elite prioritized other strategic directions — the dominant national project of the 1990s and early 2000s was integration with the European Union. Ankara's attempts to establish economic and political influence in Central Asia quickly encountered structural limits: it lacked the capacity to compete with the United States, China, the European Union, or Russia. The constraint, often noted half-jokingly but accurately, was financial. It has remained largely unchanged.

The Erdogan Era: Pan-Islamism and the Limits of the Arab World

By political evolution, Recep Tayyip Erdogan is more accurately described as a Pan-Islamist than a Pan-Turkist. He has never been closely associated with nationalist ideology and, in his early career, often regarded nationalist circles with skepticism. Consistent with a Pan-Islamist orientation, his strategic ambitions were directed toward neighboring Middle Eastern states and post-Ottoman regional influence.

Early in his tenure, Erdogan was widely regarded as a promising figure, with significant popularity across the Middle East. His team included a number of capable policymakers, and his foreign policy was articulated through Ahmet Davutoglu's "Zero Problems with Neighbors" doctrine, which prioritized deep engagement with the Arab world.

The high point came in 2011, at the height of the Arab Spring. Erdogan's reception in Cairo after the fall of Hosni Mubarak was not just diplomatic theater; it signaled a moment when Turkey appeared poised to lead a new political order in the Arab world. His model — combining electoral legitimacy, economic growth, and Islamic identity — was openly embraced by Rached Ghannouchi's Ennahda Movement and Egypt's Freedom and Justice Party under Mohamed Morsi.

The window closed quickly. The emerging Turkey–Qatar alignment triggered a counter-reaction from Saudi Arabia and the United Arab Emirates, which viewed Ankara's rise — and its association with the Muslim Brotherhood — as a direct threat. The decisive rupture came with the 2013 Egyptian coup d'état led by Abdel Fattah el-Sisi. With Morsi removed, Turkey's influence in Egypt collapsed, and Ankara's broader ambition to shape the post-Arab Spring order was effectively rolled back.

Turkey's involvement in the Syrian civil war, including support for opposition forces against Bashar al-Assad, drew the country into a prolonged security crisis marked by cross-border instability and terrorist attacks. As domestic pressures mounted and electoral margins narrowed, Erdogan entered into a strategic alliance with Devlet Bahceli of the Nationalist Movement Party (MHP). This was a pragmatic convergence: a Pan-Islamist leadership aligned with a Pan-Turkic nationalist base to secure political dominance.

It is here, around the mid-2010s, that the Pan-Turkic register began to enter Erdogan's foreign-policy vocabulary in a sustained way — not because Ankara had developed a new doctrine, but because the Middle Eastern project had stalled and the Turkish-nationalist constituency had become indispensable at home.

The OTS Era: From Rhetoric to Architecture

The Turkic Council, founded in 2009 in Nakhchivan as a relatively modest coordinating body, was reconstituted in November 2021 as the Organization of Turkic States. The Istanbul summit that year adopted the "Turkic World Vision 2040," set out priorities for cooperation across trade, transport, defense, and cultural affairs, and signaled an institutional ambition the Turkic Council had not previously projected. Member states are Turkey, Azerbaijan, Kazakhstan, Kyrgyzstan, and Uzbekistan; Hungary, Turkmenistan, and the Turkish Republic of Northern Cyprus hold observer status.

Three developments distinguish the OTS phase from earlier iterations.

First, Azerbaijan's victories in the 2020 Second Karabakh War and the September 2023 operation that restored Baku's full control over the territory altered the regional balance. Turkish drones — particularly the Bayraktar TB2 — proved decisive in 2020 and reframed Turkey's role in the South Caucasus from rhetorical patron to material guarantor. Defense exports, training arrangements, and joint exercises have since become a recurring instrument in Ankara's relations with Turkic partners, including Kazakhstan and Uzbekistan.

Second, the institutional architecture has thickened. The Turkic Investment Fund has begun operations, the Common Alphabet Commission — chaired by a deputy chairperson of the ruling AKP — has advanced proposals for orthographic convergence, and parliamentary, educational, and media platforms have multiplied. None of this constitutes integration in the European Union sense — there is no shared market, no supranational authority, no binding political commitments — but the cumulative effect is a denser web of cooperation than at any previous moment.

Third, the geopolitical environment has shifted. Russia's war in Ukraine has weakened Moscow's position in Central Asia and the South Caucasus, opening space for alternative external partners. China remains the dominant economic actor through the Belt and Road Initiative, but its presence is principally commercial and infrastructural. Turkey, by contrast, offers something the other major powers do not: a cultural and linguistic frame, defense-industrial cooperation, and an explicit invitation to participate in a shared political identity.

These shifts have produced the more theatrical expressions of the moment. At the 2021 Istanbul summit, MHP leader Devlet Bahceli presented Erdogan with a map of the "Turan World" stretching from the Balkans to East Asia. Erdogan has since referenced a "Turan Army" and invoked the Turkic world in speeches that would have been inconceivable from a Turkish leader two decades earlier. Azerbaijani President Ilham Aliyev has gone further, asserting that the Turkic world "does not consist of independent Turkic states only," its boundaries extending to "compatriots living beyond the countries that are members." Burhanettin Duran, Turkey's Deputy Foreign Minister, has argued that Ankara should adopt a "balancing role to ensure that Beijing does not engage with the Turkic world as it has with Africa." Statements of this kind generate alarm in Tehran, Moscow, and parts of the European press — the more so given Turkey's NATO membership and the substantial Turkic minorities inside Russia and China.

The Substance Is More Limited

The OTS member states themselves do not subscribe to a Pan-Turkic political project. Kazakhstan and Uzbekistan in particular have been explicit — through both rhetoric and policy — that their participation is functional, not civilizational. Astana maintains its multi-vector foreign policy, balancing China, Russia, Turkey, and the West with care; Tashkent, despite the warming under Shavkat Mirziyoyev, remains constitutionally committed to non-bloc neutrality. Neither government has any interest in being absorbed into a Turkish-led ideological architecture. Azerbaijan, the most ideologically aligned member, is also the most strategically dependent on Turkey — a relationship that constrains Baku rather than radiating outward from it.

The hesitancy that defined Central Asian responses in the 1990s has matured into something firmer. The post-Soviet republics that resisted swapping a Russian elder brother for a Turkish one are now actively building room for themselves between all the larger powers. Multi-vector diplomacy is no longer a defensive posture; it is the strategic identity of the region.

The clearest recent illustration of these limits came at the first EU-Central Asia Summit in April 2025. In their joint statement, Central Asian heads of state reaffirmed UN Security Council Resolutions 541 (1983) and 550 (1984), both of which deny recognition to the Turkish Republic of Northern Cyprus. This was a striking signal. Northern Cyprus has held observer status in the OTS since 2022, and Turkey is the only state in the world that recognizes it as sovereign. When forced to choose between alignment with European norms and solidarity with their Pan-Turkic partner, the Central Asian governments chose Europe.

The structural constraint identified earlier in this piece remains. Turkey's economy, under sustained inflationary pressure and currency volatility, lacks the capacity to underwrite a Pan-Turkic project on the scale of Chinese investment in the region or even Russian energy and labor markets. Defense exports and educational programs are real instruments, but they are insufficient to reorient the strategic calculus of Central Asian capitals.

Conclusion

Erdogan has not replaced Pan-Islamism with Pan-Turkism. His engagement with Hamas, his posture toward Gaza and the wider Muslim world, and his enduring rivalry with Saudi Arabia and the UAE all attest to the continuing centrality of the Islamist register in his political identity. What has happened is that Pan-Turkism has joined Pan-Islamism in the toolkit — deployed in similar fashion, for similar ends. Both are flexible instruments for projecting influence into regional spaces where Turkey's material capacities are constrained. Both mobilize different domestic constituencies. Neither, on its own, constitutes a coherent grand strategy.

Pan-Turkism in the OTS era is therefore neither the marginal current of the Cold War nor the transformative civilizational doctrine its admirers and detractors describe. It has acquired institutional vehicles, symbolic vocabulary, and a measure of operational substance through defense cooperation. It has not acquired the financial base, the doctrinal coherence, or the partner buy-in to become a transformative geopolitical project. The Cairo of 2011 has become the Astana of today — a venue where Ankara is welcomed, listened to, and quietly hedged against by partners pursuing their own agendas with other powers.

The entire discourse surrounding Pan-Turkism is far more about the past than the future. Even in earlier centuries, Turks, Uzbeks, and Azerbaijanis pursued their own imperial projects, which often relied on militarized imperial expansion and coercive state-building, rather than united into a single political, economic, or civilizational space. Historical experience suggests that whenever the pan-Islamic dimension becomes the dominant component of Pan-Turkist ideology, the risk of military confrontation and regional destabilization increases significantly. For much of the Republican era, Turkish political and military elites were conscious of this danger and generally sought to subordinate ideological ambitions to state pragmatism and geopolitical restraint — a pattern that many critics argue has become less consistent under the current ruling establishment.

Rafael Sattarov is an independent political analyst from Uzbekistan specializing in Cold War diplomacy, U.S.-Russia relations, Central Asia, and U.S.-China strategic competition in Asia. His work has appeared in Carnegie, Atlantic Council, The Diplomat, Le Monde, Bild, RFE/RL, and other international media outlets. He has also lectured on Central Asian affairs at George Washington University, Harvard University, and Brigham Young University. He holds a master’s degree in Asian Studies from the Higher School of Economics and a B.A. in International Relations from the University of World Economy and Diplomacy in Tashkent.

In 2025, Kyrgyzstan's licensed cryptocurrency market generated more than $30 billion in turnover — 1.3 times the country's GDP. At the same time, the government began issuing its own sovereign stablecoins: the gold-backed USDKG and the som-pegged KGST.

This paradox — a small Central Asian economy whose crypto activity significantly exceeds the country's formal GDP, while the state itself becomes a direct player in digital assets — makes Kyrgyzstan one of the most intriguing crypto experiments in the world today.

The global financial system is fragmenting. Western sanctions, de-dollarization, and the search for alternative payment rails have pushed emerging economies toward new tools for cross-border transfers, currency hedging, and capital access. Central Asia has emerged as one of Eurasia's most dynamic cryptocurrency regions, and Kyrgyzstan stands out even among its neighbors.

The market is predominantly practical rather than speculative. Most operations involve quick, low-cost conversions between fiat (traditional money such as the Kyrgyz som or US dollar) and stablecoins — digital assets engineered to hold a stable value, typically pegged to the dollar — to facilitate remittances from labor migrants. What distinguishes the Kyrgyz model is the active role of the state. Following 2025 amendments to the Law on Virtual Assets, authorities legalized state mining, the creation of a national crypto reserve, and stricter requirements for stablecoins. The introduction of USDKG and KGST signals Bishkek's ambition to harness blockchain not as a regulatory object, but as an instrument of national financial policy.

Located at the heart of the Eurasian corridor, Kyrgyzstan sits at the intersection of Russian, Chinese, Turkish, and Western interests. Its crypto activity can serve as both a bridge for regional integration and a channel for circumventing traditional financial restrictions. This article places Kyrgyzstan's crypto market in the wider Central Asian landscape, analyzes its scale, structure, and state strategy, and evaluates the emerging geopolitical risks and opportunities.

The Cryptocurrency Landscape in Central Asia

Central Asia — Kazakhstan, Uzbekistan, Kyrgyzstan, Tajikistan, and Turkmenistan — is emerging as a notable crypto region globally. The drivers are structural: heavy dependence on remittances (30–50 percent of GDP in some countries), chronic local-currency volatility, and access to relatively cheap electricity for mining.

Chainalysis' Global Crypto Adoption Index 2025 places Kyrgyzstan 19th worldwide, the strongest performance in the region, driven by massive transaction volumes and active state involvement. Uzbekistan follows with solid grassroots adoption, Kazakhstan excels as a mining and infrastructure hub, while Tajikistan and Turkmenistan lag.

National models diverge sharply. Kazakhstan has built its strategy around industrial-scale mining and the Astana International Financial Centre (AIFC), temporarily capturing a significant share of global Bitcoin hash rate after China's 2021 mining ban; regulation emphasizes "clean" mining and mandatory sales through licensed platforms. Uzbekistan leads the region in the share of population holding crypto assets (around 1.5 percent, or 512,000 people), with licensed providers processing over $1 billion in transactions under a controlled legalization regime that includes a regulatory sandbox for stablecoins and tokenized securities. Kyrgyzstan runs the region's most voluminous exchange-oriented market, with over 200 licensed operators and turnover that vastly outpaces its neighbors relative to economy size, and the government is now experimenting with national stablecoins. Tajikistan and Turkmenistan remain at earlier stages — Dushanbe has only recently established a department for digital assets, while Turkmenistan's Law on Virtual Assets took effect in 2026 under tight state control.

A common regional trend is the rising share of stablecoins — up an estimated 52 percent in 2025 — used as efficient tools for cross-border payments. Governments increasingly opt for controlled integration of blockchain, combining licensing with the development of national digital instruments. Within this landscape, Kyrgyzstan occupies a distinctive niche: a market volume that dwarfs the national economy, paired with state initiatives — USDKG, KGST, and a planned national crypto reserve — that make the country a potential testbed for the region.

The Scale and Structure of Kyrgyzstan’s Crypto Market

The growth has been explosive. In 2025, licensed Virtual Asset Service Providers (VASPs) recorded total turnover of 2.73 trillion soms, roughly $30–31 billion at average exchange rates — a nearly threefold increase over 2024 and two to three times the country's GDP of approximately $14 billion. The Financial Market Regulation and Supervision Service logged more than 2.12 million transactions over the year.

The structure is as striking as the scale. Simple exchange operations dominate, not sophisticated trading. Crypto exchange points (obmenniki) accounted for 2.58 trillion soms ($29.5 billion) — more than 94 percent of total volume — while full-fledged exchanges handled just 157 billion soms ($1.8 billion) , under 6 percent. Average transaction size reinforces the divide: around 1.23 million soms ($14,000) at exchange points, and substantially larger sums on formal exchanges.

This exchange-heavy profile reflects the market's core function. The bulk of activity involves converting between local fiat and stablecoins — primarily USDT — to facilitate remittances, hedge against som volatility, or enable faster and cheaper cross-border payments. For labor migrants' families and small businesses, crypto serves as a digital bridge to hard currency rather than a speculative asset.

By early 2026, Kyrgyzstan had registered over 200 licensed operators, including more than 80 exchange points and around five dedicated exchanges. The sector also includes 11 industrial mining companies, though mining remains secondary to the exchange business. Crypto tax revenue reached approximately 1.7 billion soms (about $22.8 million) in 2025 — more than the combined receipts from the Dordoi bazaar, Central Asia's largest wholesale market, and all patent-based entrepreneurs. That fiscal contribution has quietly elevated the sector's legitimacy in the eyes of Bishkek policymakers.

Yet the ecosystem's limits are equally clear. More advanced use cases — DeFi (decentralized finance platforms that let users lend, borrow, and trade without banks), yield farming (earning returns by locking up crypto assets), and complex tokenized real-world assets — remain marginal. Kyrgyzstan has built a highly liquid exchange corridor while Kazakhstan pursues mining infrastructure and Uzbekistan focuses on retail adoption under tighter licensing. The question now is whether this volume can evolve beyond basic conversions — and how the state's growing involvement will shape the next phase.

State Strategy: From Licensing to National Stablecoins

Kyrgyzstan's approach stands out in Central Asia for its proactive state involvement. Rather than simply regulating a booming informal market, Bishkek has moved to shape and participate in it directly. The foundation was the 2022 Law on Virtual Assets, which introduced VASP licensing. The real turning point came in September 2025, when parliament passed amendments in three readings, formally introducing a state cryptocurrency reserve and state mining while refining rules for stablecoins and real-world asset (RWA) tokenization. The amendments also raised capital thresholds for exchanges starting in 2026 and encouraged hydropower-based mining. The government no longer treats crypto merely as a remittance or hedging tool, but as an instrument of national financial policy.

The most visible expression of this strategy is the launch of two sovereign-backed stablecoins in late 2025.

USDKG, a dollar-pegged stablecoin backed by physical gold, was issued in October–November 2025. The initial emission totaled approximately $50 million (50.14 million tokens at $1 each) on the Tron network, with plans to expand to Ethereum. It is issued by OJSC Virtual Asset Issuer, a fully state-owned entity under the Ministry of Finance, and positioned for cross-border payments and international trade. Long-term ambitions include scaling reserves to $500 million and eventually $2 billion.

KGST, pegged 1:1 to the som, followed shortly after. Launched in partnership with international platforms and listed on Binance in December 2025, it is designed for domestic and regional settlements and for integration with the planned Digital Som, Kyrgyzstan's central bank digital currency (CBDC), currently in the pilot design phase. President Sadyr Japarov framed the Binance listing as recognition of Kyrgyzstan's regulatory maturity. The som-pegged token is seen as particularly useful in rural areas with underdeveloped banking infrastructure and for easing remittance flows.

These initiatives are part of a broader vision. The government is exploring a national crypto reserve that could include Bitcoin and other assets accumulated through state mining, and it has announced plans to pilot Digital Som payments in public finance.

For a small economy, this level of state engagement is ambitious. It reflects a desire to capture value from an already massive exchange market while reducing the risks associated with purely private or offshore operators — and it positions Kyrgyzstan as an experimental laboratory for the region, testing how sovereign digital assets can coexist with high-volume, remittance-driven crypto activity. Whether the model delivers long-term stability or introduces new vulnerabilities will depend on implementation, particularly as external scrutiny from the IMF and FATF intensifies.

Geopolitical Context and Risks

Kyrgyzstan's crypto market sits at the intersection of practical economic needs and broader geopolitical currents. Located at the heart of the Eurasian corridor, the country has become a de facto crypto corridor linking remittance and trade flows among Russia, Central Asia, and China.

This role drew sharper attention after Russia's full-scale invasion of Ukraine in 2022. Since then, Moscow has increasingly used Central Asia — and, to a lesser extent, the South Caucasus — as a transit corridor for both physical goods (especially dual-use items) and financial flows routed around conventional banking channels. Kyrgyzstan, thanks to its relatively open licensing regime and geographic position, has emerged as one of the most active nodes in this network. Much of the activity involves converting rubles or dollars into USDT for migrant remittances or cross-border trade that bypasses slower traditional banking.

External observers have flagged particular concern over the ruble-pegged stablecoin A7A5, issued by Kyrgyz-registered Old Vector LLC. According to the blockchain analytics firm Elliptic, A7A5 processed more than $100 billion in transactions in 2025 and accounted for roughly 43 percent of the global non-dollar stablecoin market by year-end. The token, which processed tens of billions of dollars in volume in 2025, was specifically designed, according to the U.S. Treasury, to allow Russian entities to move value outside the conventional financial system. In August 2025, the US Treasury's Office of Foreign Assets Control (OFAC), the UK, and subsequently the EU sanctioned A7A5 along with related Kyrgyz entities, including Old Vector and the exchange Grinex, for their alleged role in large-scale sanctions evasion. The EU's 20th sanctions package, adopted in April 2026, extended these measures with an industry-wide ban on Russia-based crypto services and additional restrictions on the Kyrgyz exchange operating A7A5.

A7A5 is the digital arm of A7, a Russian cross-border payments platform launched in 2024 and itself now under Western sanctions. On paper, A7 is owned by the fugitive Moldovan oligarch Ilan Shor (51 percent) and the sanctioned Russian state bank Promsvyazbank (49 percent), with reported backing from the state development corporation VEB.RF. An April 2026 investigation by the independent Russian outlet Proekt added significant texture to this picture. Citing leaked financial documents and sources in the cross-border payments market, Proekt identified Russian billionaire Roman Abramovich as A7's alleged "roof and sponsor" — a claim Abramovich's representatives have denied — and pointed to multi-billion-ruble loans from Pharmstandard, the pharmaceutical holding controlled by Abramovich's longtime associate Viktor Kharitonin. The investigation also identified at least 25 EU- and US-sanctioned Russian firms among A7's clients, including five manufacturers and suppliers of combat drones used by the Russian army in Ukraine. President Vladimir Putin attended the virtual ribbon-cutting of a new A7 branch in September 2025.

The implications for Kyrgyzstan are substantial. The A7/A7A5 architecture illustrates how the country's open licensing regime and geographic position have been leveraged by an externally directed financial network operating largely outside Bishkek's effective control — and tied directly to Russia's war economy. This is the dimension of the crypto corridor that international regulators have focused on, and the one most likely to shape how the country's broader sector is perceived abroad.

The Kyrgyz government has sought to address these risks through tighter licensing and sovereign-backed instruments. By emphasizing gold backing, independent audits, and state oversight, Bishkek aims to project transparency and differentiate its model from offshore or unregulated platforms elsewhere in the region.

International scrutiny has nonetheless continued. In its Staff Concluding Statement for the 2026 Article IV consultation, released April 9, 2026, the IMF acknowledged Kyrgyzstan's strengthened regulatory framework but warned that "growing exposure to crypto asset activities and cross-border trade and financial flows could pose new risks" to macro-financial stability. The Fund urged authorities to enhance supervisory capacity, improve risk monitoring, and strengthen anti-money-laundering and counter-terrorist-financing (AML/CFT) measures to match the sector's expansion.

The timing was pointed. In mid-April 2026, Chairman of the Cabinet of Ministers Adylbek Kasymaliev led a high-level delegation, accompanied by National Bank officials, to the IMF–World Bank Spring Meetings, where they held bilateral discussions with representatives of the International Monetary Fund, the World Bank, and the U.S. Department of the Treasury, alongside other international financial institutions.

The public agenda centered on hydropower projects and macroeconomic support, but the IMF statement underscored growing external pressure on Bishkek to demonstrate effective oversight of its crypto corridor.

Kyrgyzstan has responded by proposing partnerships in regulatory technology (RegTech) and positioning itself as a potential regional hub for compliant digital finance. Compared to Kazakhstan's mining-centric model and Uzbekistan's controlled retail adoption, the Kyrgyz blend of high-volume exchange activity and state-backed stablecoins produces a distinctive — and more exposed — profile. The risks are multifaceted: potential sanctions blowback, capital-flight pressure on the som, and gaps between licensing rules and enforcement. But successful implementation of sovereign stablecoins and improved supervision could flip these vulnerabilities into strategic advantages, allowing Kyrgyzstan to serve as a regulated gateway for Central Asian digital payments.

Conclusion

Kyrgyzstan is no longer a passive participant in the global crypto space. It is actively shaping a Central Asian model of its own. With licensed turnover above $30 billion in 2025 — more than 1.3 times the GDP — and the launch of sovereign stablecoins USDKG and KGST, the country is testing whether a small economy can wield digital assets as both an economic lifeline and a tool of statecraft.

The coming years will be decisive. If Bishkek strengthens regulatory oversight, secures the credibility of its gold-backed instruments, and contains sanctions-related exposure, Kyrgyzstan could evolve into a genuine regulated crypto corridor for Central Asia — offering efficient remittance channels, sovereign digital tools, and a bridge between Russia, China, and wider markets. That outcome would make the country a bellwether for the region, demonstrating how states can exert meaningful control over crypto activity rather than merely react to it.

The downside scenario is equally plausible. Failure to close the gap between ambitious regulation and effective enforcement, or sustained exposure to sanctions-circumvention channels, could trigger stronger pressure from the IMF, FATF, and Western regulators. In that case, the very openness that fueled rapid growth would become a liability.

As Central Asia navigates financial fragmentation and geopolitical realignment, Kyrgyzstan's experiment carries implications well beyond its borders. The choices Bishkek makes between 2026 and 2030 — balancing innovation against stability, sovereignty against international legitimacy — will help determine whether the region develops resilient, sovereign-led digital finance ecosystems or remains vulnerable to external shocks and regulatory crackdowns. Kyrgyzstan's crypto story is still being written. Its outcome may well signal the trajectory of digital assets across Eurasia.

Corrected May 4, 2026: An earlier version of this article stated that Kyrgyzstan's 2025 crypto turnover exceeded GDP by a factor of two to three. The correct ratio is approximately 1.3x, based on 2025 GDP of $22.6 billion.

Aigerim Turgunbaeva is an independent journalist and researcher specializing in Central Asia. She covers press freedom, human rights, and China’s regional influence, with work published in The Guardian, The Diplomat, Reuters, and Eurasianet. A Rumsfeld Fellow, she also contributes to the AFPC’s Central Asia-Caucasus Institute.

Beijing is gaining ground economically and diplomatically, but avoiding the risks – and rewards – that global leadership can bring.

The war in Iran and the blockade of the Strait of Hormuz are, depending on whom you ask, either a strategic windfall for Beijing or a black swan event that could eventually undermine its export-driven economy.

But after months of war — and a new phase shaped by tenuous cease-fire talks and a U.S. blockade of Iranian ports — the reality is more complicated. The war has proved a mixed blessing for Beijing, exposing its unwillingness to take up the mantle of global leadership.

Rising yuan transactions, new frictions between the United States and its allies, and a U.S. strategic pivot back to the Middle East from the Asia-Pacific all benefit Chinese policymakers. But the war in Iran is also showing Beijing’s limits as a power broker and revealing that its superpower ambitions remain confined, for now, to trade hegemony.

China has moved to seize some opportunities, capitalizing on rising anti-American sentiment and strengthening its global standing amid the fallout. But Beijing has stayed on the sidelines, opting for a slow, diplomatic approach: prioritizing opportunistic inroads, shielding its economy, and stabilizing its rivalry with the United States ahead of a high-profile summit between U.S. President Donald Trump and Chinese leader Xi Jinping scheduled for mid-May.

Beijing would prefer that the global economic uncertainty brought by the war did not exist at all. Its actions should therefore be viewed less as a bid for greater influence and more as a defense of stability — both at home and in an increasingly disrupted Middle East.

Playing Defense In A Disrupted Global Economy

Since U.S.-Israeli strikes on Iran on February 28, Beijing has cast itself as a pillar of international stability and as a foil to a more erratic White House. That strategy has yielded real dividends. China has edged ahead of the United States in recent Gallup polling, and longtime U.S. partners like the United Kingdom and Canada — already navigating frictions with the current administration — have looked to repair and deepen ties with Beijing as a hedge against American volatility amid the war.

Other secondary benefits have followed. The blockaded Strait of Hormuz and rising oil and gas prices have boosted demand around the world for China’s green technology sector, driving orders for Chinese-made solar panels and electric vehicles.

The war has also fueled fresh enthusiasm about the yuan’s prospects to rival the U.S. dollar. The currency has become a main form of payment for ships that have paid illegal tolls to Iran for safe transit through the Strait of Hormuz. and the volume of yuan-denominated crude oil sales has increased due to the war. Chinese state media report that the nation’s Cross-Border Interbank Payment System (CIPS) — China’s alternative to the U.S. SWIFT payment system — has logged record highs, surpassing 1.22 trillion yuan ($178 billion) in single-day transactions for the first time in April.

Beijing has also sought diplomatic gains elsewhere. Both Xi and Chinese Foreign Minister Wang Yi have been quick to denounce U.S. actions and frame Beijing as an arbiter of international norms, with the Chinese leader calling the disruptions brought from the war a “return to the law of the jungle.” Some reports, including comments from Trump himself, have also suggested China played a role in bringing Tehran to the table for cease-fire talks in Islamabad.

But it is unclear how much strategic gain Beijing actually reaps. The stepped-up activity likely reflects Chinese anxiety that the war’s economic fallout could rebound on China itself. Rising commodity prices driven by Middle East supply disruptions could squeeze profit margins.=, while sustained oil price increases could weaken global demand and slow orders for Chinese manufacturers.

China has also held back from a larger play for influence. Beijing’s strategic petroleum reserve is the largest in the world, with the commodity intelligence firm Kpler estimating that Chinese refineries stockpiled between 1.2 and 1.4 billion barrels of oil before the war began. China is also the world’s second-largest exporter of fertilizer and holds stockpiles of industry-critical materials. Some analysts have suggested that Beijing could contribute a portion of its oil reserve to a global stability pool and extend similar support with fertilizer to head off a potential food crisis in the Global South.

Instead, it has restricted exports to bolster domestic security and an economy still grappling with the aftershocks of COVID-19 policy missteps and a collapsing property sector.

A Fragile Partnership and a Tightrope in the Middle East

This defensive posture is also visible in China’s complicated relationship with Iran and its delicate balancing act with the Gulf States.

China is Iran's largest oil buyer by far, taking up to 90 percent of the country’s crude. Beyond providing discounted oil, Tehran has also been a reliable anti-Western bulwark. In return, Beijing has become Tehran's largest trading partner and an increasingly important source of technology and security cooperation — vital to Iran's ability to withstand Western political and economic pressure.

But the relationship has also been marked by mismatched expectations and behind-the-scenes frictions. The two countries signed a comprehensive strategic partnership in 2016, culminating in a highly touted 25-year strategic cooperation agreement in 2021. Reports suggested the deal envisioned up to $400 billion in Chinese investment in Iran, but only $2-$3 billion has been confirmed to date, with many Chinese firms steering clear due to U.S. secondary sanctions. This gap has spilled into public view: in 2023, then-Iranian President Ebrahim Raisi said that there was a “serious regression” in ties with Beijing and that the economic dimension of the relationship had become unsatisfactory for Tehran.

The war has also tested China’s dual-track approach in the Middle East. As Beijing has maintained its partnership with Tehran, it has meticulously deepened its ties with Arab states, with energy as a key focal point. China currently sources more oil from the Gulf than from Iran, and Qatar was the country’s top LNG supplier prior to the war.

This represents another tension Beijing will find increasingly difficult to balance. As China calibrates its support for Tehran — seeking to prevent regime collapse while avoiding a wider regional war — it must also account for the interests of Gulf nations facing Iranian attacks.

That has opened a door for Beijing. The war’s disruption has prompted many traditional U.S. partners in the region, including Saudi Arabia and the UAE, to question their strategic reliance on Washington, and Beijing has moved to exert greater influence. Xi hosted Abu Dhabi Crown Prince Sheikh Khaled bin Mohammed in mid-April, vowing to make the partnership between China and the UAE “more solid, resilient, and dynamic.” That was followed by a call with Saudi Arabia’s Crown Prince Mohammed bin Salman — the first in more than three years — in which Xi pledged to deepen mutual strategic trust and called on Middle Eastern nations to “hold their future in their own hands,” according to a Chinese readout.

But the war has also exposed the limits of Chinese influence and how much skin Beijing is willing to put in the game. Both Saudi Arabia and Iran have called for China to play a bigger role as a mediator, but China’s leadership has so far kept its distance and appears unwilling to get further entangled in a crisis that it did not create.

Calibrating the U.S.-China Rivalry

Perhaps the most striking display of China’s slow approach to the war in Iran is how it has managed its rivalry with the United States. There have been no vitriolic denunciations of U.S. strikes and no visible attempts to exploit the thinning of American military forces in the Asia-Pacific.

This partly reflects hard lessons learned from China’s era of “Wolf Warrior” diplomacy — a confrontational and nationalist style of public diplomacy adopted by some Chinese diplomats — that damaged its global image in the aftermath of the COVID-19 pandemic and provoked backlash in multiple regions.

There is also a strong incentive to keep relations with Washington stable for the time being. The Xi-Trump summit, set for May, was already rescheduled once, and Beijing believes it holds a strong hand with the United States following their earlier trade war. The summit will focus on a range of trade, technology, and military issues, but Beijing has its sights on possible changes in the U.S. posture on Taiwan or a reduction of arms sales to the island. It is no coincidence that Xi hosted Cheng Li-wun, the leader of Taiwan’s opposition Kuomintang (KMT), in April and offered incentives to a future KMT government for bilateral cooperation.

This may indicate that Xi has no near-term designs on Taiwan —a view recently expressed by the US intelligence community — but also that China's leader is wary of rocking the boat amid fears of another escalating crisis. For all the criticism of Washington's moves on Iran, it has been a formidable display of American military power that Beijing cannot rival, particularly given a hollowed-out military leadership following successive purges.

Xi appears to have decided that the war in Iran is not Beijing’s moment. The United States remains a military and financial superpower, occupying a role on the world stage that China is not ready for — and may never be willing to fully assume.

Chinese leadership appears focused on weathering the global shocks of the war and is content to wait for an outcome in Iran before engaging in the aftermath. This offers a playbook for a country that still primarily defines success by its domestic situation at home, not one of a government ready to assume the risks and reap the rewards of global leadership.

Reid Standish is a journalist covering Chinese foreign policy across Eurasia and is RFE/RL's Prague-based China Global Affairs Correspondent. He has reported extensively on Chinese investment, security policy, and political influence across Eastern Europe and Central Asia. Prior to RFE/RL, Reid was an editor at Foreign Policy magazine and its Moscow correspondent. He has also written for The Atlantic, Politico, and The Washington Post.

Economic cooperation between Kazakhstan and Armenia is gaining momentum, set against Trump administration-backed efforts to normalize Armenian–Azerbaijani relations. This engagement could give the Trump Route for International Peace and Prosperity, or TRIPP, initiative real economic substance, driven by regional actors seeking to develop new transport corridors and diversify existing routes. For now, however, significant military and political risks remain beyond the capacity of local actors to overcome.

How Astana Entered the TRIPP Conversation

On April 8-9, Kazakhstan's Minister of Foreign Affairs, Yerzhan Kosherbayev, and Minister of Transport, Nurlan Sauranbayev, traveled to Armenia on an official visit. The discussions built on issues first raised on November 20, 2025, when Armenian Prime Minister Nikol Pashinyan visited Kazakhstan. Pashinyan's trip followed a new stage in the Armenian-Azerbaijani peace dialogue, backed by the Trump administration, and the announcement of the TRIPP project. In November 2025, the Kazakh side proposed a new transport artery based on TRIPP and linked to the Middle Corridor, which would pass through Armenia to provide faster access to Turkey and, through it, to Europe.

The April visit also produced a strategic partnership between Kazakhstan and Armenia. The Armenian-Azerbaijani peace process has allowed Astana to deepen ties with Yerevan without risking discontent from Azerbaijan, with which Kazakhstan also maintains close relations.

Kazakhstan had signaled its interest in the project as early as August 2025, in the first days after the TRIPP agreement was signed. A new international transit route is emerging — an alternative to the Georgian segment of the Middle Corridor — and Kazakhstan is a central player in freight transport between China and Europe.

Kazakhstan is closely monitoring the prospects for integrating TRIPP with the Middle Corridor, as well as the durability of the Azerbaijani-Armenian peace process that made the TRIPP initiative possible in the first place. Oil-rich Kazakhstan, one of the wealthiest post-Soviet states by GDP per capita, is exploring investment opportunities along the route.

Against this backdrop, Kazakhstan and Armenia have begun exploring the practical implementation of TRIPP, including viable commercial applications for an initiative that remains largely political in scope. Developing its commercial dimension could help stabilize the Armenian-Azerbaijani peace process while expanding the transit capacities of Central Asian countries.

At the April 9, 2026, meeting between the two foreign ministers, both sides announced their intention to advance TRIPP and to deepen bilateral trade, economic, and investment dialogue. In a subsequent meeting with Prime Minister Pashinyan, Kazakhstan's foreign minister reaffirmed Astana's readiness to develop TRIPP as a means of expanding the region's transit potential.

Trade is Growing, But Moscow Still Shapes the Ceiling

Kazakh-Armenian economic relations are developing rapidly. In 2025, exports of Kazakh grain to Armenia resumed via a railway route through Russia, Azerbaijan, and Georgia. Contracts for Kazakh food products — including grain and meat — are expected to be long-term.

Bilateral trade volumes nonetheless remain modest. Trade turnover between Kazakhstan and Armenia amounted to $69.2 million in 2025, $49 million in exports from Kazakhstan to Armenia and $20.2 million in imports from Armenia. The two countries have signed a Roadmap for Trade and Economic Cooperation for 2026–2030 that is expected to drive rapid expansion in bilateral trade.

An intergovernmental commission and a Kazakh-Armenian business council are already in place. Mutual investment is growing: more than 100 enterprises with Kazakh capital are registered in Armenia, while over 400 Armenian companies operate in Kazakhstan. The Kazakh government has shown particular interest in expanding cooperation in high-tech sectors; a branch of the Armenian educational program TUMO recently opened in Astana.

A potential breakthrough in bilateral relations could come if Armenia's railways were transferred to Kazakh investors — a possibility that surfaced in media reports around the April negotiations. Such an investment would significantly advance the practical realization of TRIPP. But this is only one of several possible scenarios. Armenia's railways remain under the control of Russian investors. While the Pashinyan government does not enjoy particularly strong relations with Moscow, Pashinyan himself has stated that any decision on the railways will be made in dialogue with Russia. The Kazakh government, which maintains fairly close ties with Moscow within its multi-vector framework, is unlikely to invest in Armenia's railways unless such a move is, in some form, coordinated with Russia.

More broadly, extending Kazakh-Armenian cooperation into the implementation of TRIPP faces significant geopolitical risks — above all, the positions of Iran, China, and Russia. Neither Yerevan nor, still less, Astana is willing to challenge these players in the South Caucasus. Both are instead exploring practical pathways for TRIPP's implementation, contingent on the Trump administration reaching an understanding with other extra-regional powers. So long as there are serious risks of spillover from hostilities involving Iran into the South Caucasus (as with recent Iranian drone strikes on Nakhchivan), continued Chinese resistance to expanding U.S. influence in Central Asia and the Caspian region, and the potential escalation of U.S.-Russia confrontation, major investments in TRIPP from a cautious actor like Kazakhstan are unrealistic. Additional risks stem from Armenia's relations with Azerbaijan and Turkey. In both cases, the Pashinyan government has made progress toward a stable peace, but the process remains incomplete. Significant domestic political forces in Armenia opposed to such reconciliation continue to challenge Pashinyan. This internal uncertainty further discourages potential Kazakh investors.

Why Kazakhstan Needs TRIPP — and Why TRIPP Needs Kazakhstan

TRIPP runs through the Syunik Province in southern Armenia, linking mainland Azerbaijan with its Nakhchivan exclave and onward to Turkey. Kazakhstan is not a direct participant in the corridor. Indirectly, however, if the route is integrated with connections across Kazakhstan, the Caspian Sea, Azerbaijan, Armenia, and Turkey, it could provide Kazakhstan with an alternative pathway to Turkey and, beyond it, to Europe, bypassing Georgia. This would create an additional branch of the existing Middle Corridor linking the Caspian region to Europe. Kazakhstan and transit shippers using its territory would gain greater flexibility in using the Middle Corridor.

From Kazakhstan's perspective, TRIPP establishes a second Trans-Caucasian route that allows cargo flows to bypass the Georgian segment. This is less about direct competition with the Georgian route than about diversification within a single macro-corridor. Such diversification could expand overall capacity and improve system resilience, reducing exposure to political disruptions and infrastructure bottlenecks. The Georgian and Armenian routes may also compete on cost and speed, driving down transit prices. In turn, this would strengthen the throughput capacity of the Middle Corridor, improve access for Central Asian exports to global markets, and support the scaling up of China-Europe transit through Kazakhstan.

The Armenian route to Southern and Central Europe via Turkey is more direct than the Georgian alternative — which relies on Black Sea shipping — potentially reducing delivery times along with fuel and operating costs. Diversifying the Middle Corridor across the South Caucasus also allows stakeholders to hedge against rising risks in Georgia, particularly those tied to the deterioration of relations between Tbilisi and the West. These include regulatory risks (potential instability in trade regimes with the EU), institutional risks (declining trust from EU governments, international banks, and logistics operators), and the prospect of domestic political instability linked to polarization within Georgia. All of this may affect insurance and transit costs, increase customs friction, and lead investors to price in higher risk premiums.

Kazakhstan occupies a pivotal position among actors interested in developing TRIPP as part of the Middle Corridor. It is the largest transit economy in Central Asia and a key overland bridge between China and the Caspian Sea. Kazakhstan also accounts for a significant share of Central Asia's trade with the European Union. Its interest in investing in TRIPP stems from the fact that the project would expand a system in which Kazakhstan already serves as a central hub. If Middle Corridor capacity grows through integration with TRIPP, overall cargo flows are likely to grow with it, along with transit volumes passing through Kazakhstan.

Kazakhstan has a clear interest in investing in TRIPP as a way to secure influence over tariffs, participate in governance mechanisms, and gain access to data and cargo flows. It is well-positioned to do so, drawing on substantial financial resources, state-controlled enterprises, and sovereign wealth funds.

Even without direct investment in Armenia, integrating TRIPP with the Middle Corridor would require Kazakhstan to expand its own transport capacity — overland and maritime. It would also require investment in digital infrastructure, including unified cargo tracking systems, electronic documentation, and integrated tariff platforms. Without such upgrades, broader expansion of trade along the Middle Corridor would be difficult to achieve.

As for Astana's political role, integrating TRIPP with the Middle Corridor will require coordination among a wide range of regional and external actors. Kazakhstan is well placed to act as a neutral mediator, consistent with its multi-vector foreign policy. Kazakhstan and Azerbaijan are already discussing an agreement aimed at strengthening the status of the Trans-Caspian Corridor in the context of the opening of the Zangezur Corridor.

Astana has developed a reputation as an "honest broker" for several reasons:

·      Multi-vector diplomacy — maintaining working relationships with the United States, China, Russia, Turkey, Armenia, and Azerbaijan, among others.

·      A track record as a neutral platform — Kazakhstan has previously hosted direct Armenian–Azerbaijani negotiations and played a role in facilitating dialogue between Russia and Turkey over Syria within the so-called "Astana process."

·      No direct territorial or military interests in the South Caucasus.

Kazakhstan can convene formal, high-level meetings among relevant stakeholders while also facilitating informal contacts (Track 1.5 and Track 2). Such consultations could help build political consensus on key issues, including security arrangements along the Armenia-Azerbaijan border, corridor governance, transit security, and the protection of investments.

Kazakhstan could also act as a technical intermediary and "systems integrator" in logistics, aligning the interests of different states and commercial actors in integrating the Middle Corridor and TRIPP — particularly in harmonizing customs procedures, digital transport documentation, and transit tariffs.

Kazakhstan would, however, face important constraints. These stem from its role as a formally neutral actor in South Caucasus affairs and from the sensitivities embedded in its relations with multiple partners. Astana neither can nor seeks to guarantee security in the South Caucasus, nor is it in a position to impose solutions on the parties involved. Maintaining balance among actors themselves in conflict will require considerable caution. Armenia could perceive a "pro-Turkish" or "pro-Azerbaijani" tilt; Azerbaijan might view Kazakhstan as insufficiently supportive; Iran, China, or Russia could read Kazakhstan's involvement in a U.S.-backed initiative as a challenge to their own interests. If Astana chooses to mediate on TRIPP within its multi-vector framework, it will do so with considerable restraint.

Kazakhstan is best understood, in this sense, as an "architect of the negotiating environment" — providing a platform, facilitating dialogue, and helping develop technical agreements, rather than acting as a guarantor or enforcer.

A Decisive Role, With Hard Limits

Economic cooperation between Kazakhstan and Armenia is deepening rapidly. This engagement could give TRIPP tangible economic substance, driven by regional actors interested in developing new transport routes. Kazakhstan has a particularly strong stake in diversifying the Middle Corridor and is well-positioned to contribute substantially to its practical implementation through investment, diplomacy, and technical coordination among stakeholders.

Significant military and political risks nonetheless persist. Neither Yerevan nor, especially, Astana is likely to move from economic cooperation to TRIPP implementation unless the Trump administration addresses the project's broader geopolitical risks.

Until these risks are mitigated, Armenia and Kazakhstan will continue to deepen economic cooperation in other areas, laying the groundwork for a rapid pivot to joint engagement in international transport projects should the geopolitical environment become more favorable.

Dr. Andrei Kazantsev-Vaisman is a Research Fellow at the Turan Research Center specializing in international relations and security in Eurasia. He is also a fellow at the Begin-Sadat Center for Strategic Studies at Bar-Ilan University and has held academic appointments at the Higher School of Economics in Moscow, the Eurasian National University in Astana, and Narxoz University in Almaty. During the war on terror in Afghanistan, he directed the Center for Central Asian and Afghan Studies at the Moscow State Institute of International Relations and served on the Russian–American Working Group on Counterterrorism in Afghanistan under the East–West Institute. He is the author of over 100 publications, including 25 peer-reviewed articles indexed in Scopus, and his expert analysis has been cited by major international media including The Wall Street Journal, Associated Press, The Washington Post, BBC, and Deutsche Welle.

With elections to Kazakhstan’s restructured parliament about three months away, a new political party has just entered the contest.

Not surprisingly, it is a pro-presidential party.

The 8th political party

The Adilet (Justice) Party, not to be confused with the earlier Adilet Democratic Party that existed from 2004 to 2013, held its founding congress in Astana on May 7. The approximately 1,000 delegates at the congress elected Aybek Dadabay to be party chairman.

Dadabay was Kazakhstan’s presidential administration head from February 2024 until May 5 this year, when President Kassym-Jomart Tokayev relieved him of the post, making First Deputy Prime Minister Roman Sklyar his successor.

Read the full article on BNE Intellinews.

Bruce Pannier is a Senior Fellow at the Turan Research Center.

Anyone who still views Iranian terrorism abroad as a Shiite affair carried out by Hezbollah operatives on orders from Tehran is reading from a script Tehran itself abandoned long ago. In 2026, the Islamic Republic’s overseas operations structure looks more like a layered ecosystem than a chain of command: Islamic Revolutionary Guard Corps–Quds Force (IRGC-QF) and Ministry of Intelligence (MOIS) officers at the top, Lebanese Hezbollah and aligned Shiite networks in the middle, and a wide periphery of criminal gangs, sympathizers groomed online, local recruits, teenagers, and—when convenient—Sunni jihadists or non-Iranian actors at the bottom. The point of this architecture is not ideological purity but plausible deniability.

British officials no longer hide their assessment. The UK government’s September 2025 response to the Intelligence and Security Committee’s Iran report stated bluntly that the physical threat posed by Iran has grown sharply since 2022, that MI5 and the police have responded to twenty Iran-backed plots presenting potentially lethal threats, and that Iranian intelligence services increasingly use organized criminal gangs abroad. The same logic is at work in the South Caucasus. In January 2026, Azerbaijan’s State Security Service announced the arrest of three Azerbaijani citizens who had approached a foreign embassy in Baku after entering, in the official phrasing, “criminal relations” with the ISIS Khorasan (ISIS-K) group. Reporting from both Israeli sources and Reuters clarified that the foreign embassy was Israel’s, without verifying the assailants’ possible affiliation.

Read the full article on the Jerusalem Institute of Strategic Studies.

Alex Grinberg is a Senior Fellow at the Turan Research Center.

A small group of Russian nationalists has been calling to “reclaim” Russia’s colonial territories since the Soviet Union collapsed in late 1991. After the Kremlin finally acted on these aspirations by invading parts of Ukraine, the number of Russian nationalists calling for the reconquest of areas seized by the Russian Empire or Soviet Union increased, and their cries grew louder.

Central Asia, particularly Kazakhstan, has been targeted in these remarks with increasing frequency since Russia launched its full-scale invasion of Ukraine in late February 2022. Oddly, this irredentism comes as Russian xenophobia has focused on Central Asian migrant laborers working in Russia.

Four years on from the launch of Russia’s full-scale war on Ukraine, some of the governments in Central Asia are becoming weary of enduring these threats of being reconquered by Russia. Officials in Central Asia are responding, and the number of Central Asian migrant laborers in Russia is dropping.

Read the full article on the Foreign Policy Research Institute.

Bruce Pannier is a Senior Fellow at the Turan Research Center.

The removal of Tashiev did not simply eliminate a powerful figure. It disrupted a governance mechanism that balanced regional elites, distributed control over the security apparatus, and contained intra-elite competition. In its place, a more centralized and personalized presidential vertical is taking shape. This consolidation may enhance short-term governability yet it also raises deeper questions about systemic resilience.

Following the October 2020 political upheaval, Kyrgyzstan’s executive system coalesced around an informal dual structure. By 2021, this arrangement, widely referred to domestically as eki dos (“two friends”), had become the de facto governing model of the post-revolutionary order.

At its core, the tandem between Japarov and Kamchybek Tashiev represented an informal division of political labor rather than a codified institutional framework. Japarov retained formal constitutional authority and served as the public face of the state. Tashiev, appointed head of the State Committee for National Security (GKNB) in October 2020 and later elevated to deputy chairman of the Cabinet of Ministers, gradually consolidated control over the security apparatus, anti-corruption campaigns, and elite discipline. By 2022, the GKNB had dramatically expanded its mandate into economic, educational, and even diplomatic spheres.

Read the full article on Central Asia-Caucasus Institute.

Aigerim Turgunbayeva is a Research Fellow at the Turan Research Center.