NBG expands supervisory framework for virtual asset service providers

To expand the supervisory framework governing virtual asset service providers (VASPs), the National Bank of Georgia (NBG) has enacted significant amendments to the Rules on Registration, Revocation of Registration, and Regulation of Virtual Asset Service Providers.

According to the NBG, these legislative changes aim to mitigate risks in virtual asset services, bolster market trust, and ensure the sector’s sustainable growth.

Grounded in international best practice and incorporating feedback from ecosystem stakeholders, the NBG’s enhanced framework introduces additional regulatory obligations for crypto-asset firms.

Under the updated risk-based oversight regime, minimum supervisory capital requirements have been established based on specific business activities:

Convertible Virtual Asset Exchange & Transfer Services (including self-service kiosks): At least GEL 150,000
Trading Platform Administration Services: At least GEL 350,000
All Other Virtual Asset Services (excluding initial stablecoin offerings): At least GEL 250,000

Under the Rules on Initial Offerings of Stable Virtual Assets, issuers face a baseline minimum capital requirement of 500,000 GEL, which scales upward in tandem with their reserve holdings. Crucially, firms offering multiple virtual asset services must comply with the highest single capital threshold applicable across their entire operations.

Furthermore, the revised regulations introduce comprehensive risk management requirements, covering operational risk assessment and controls, cybersecurity measures, operational management protocols, and business continuity planning.

The regulator has also established distinct registration criteria for entities launching initial stablecoin issuances, mandating tailored corporate governance frameworks, regulatory capital thresholds, and robust disclosure standards.

Under the updated rules, administrative acts issued by the NBG confirming a provider’s registration will explicitly specify the exact category of virtual asset service the entity is licensed to perform. The central bank will maintain a public registry reflecting these designated activity types for each registered provider.

According to the National Bank of Georgia, existing VASPs registered with the NBG have been granted a transition period to ensure seamless compliance with the new obligations:

Risk Management Framework Compliance: Mandatory by 1 July 2027
Minimum Supervisory Capital Compliance: Mandatory by 1 September 2027