Stablecoin depeg: will the 1.00 euro peg hold?

The information provided in this article is for informational purposes only and does not constitute financial advice. Cryptocurrency investments carry a high degree of risk. Always conduct your own research.A stablecoin depeg is the moment the market price leaves its tie to the euro or the dollar. What the MiCA regulation requires of the reserve and of redemption, how to recognise a token's design, and what a swap into a stablecoin means for your holding period. A stablecoin is meant to be worth the same thing at all times: one euro, one dollar, no movement. A depeg is the moment when that stops being true: the market price of the token comes loose from the value it refers to. The most important number in all this is not in an exchange's order book, it is in your claim against the issuer. With an e-money token authorised in the EU, the issuer pays back par value, at any time and free of charge. That is set out in Article 49 of Regulation (EU) 2023/1114, which everyone calls MiCA. The exchange price and the redemption price are two different numbers at two different counters, and anyone who confuses them sells at a discount at the wrong moment. On Sunday morning there is no sign of ...