Denmark based CASP4.8/5Guide · Crypto basics · Updated 21 July 2026 · 3 min read
What is a stablecoin?
A stablecoin is a cryptocurrency that tries to hold a steady value — typically pegged 1:1 to a currency like the dollar or euro. It gives you a price-stable unit on the blockchain, without the large swings of an asset like Bitcoin. This guide explains the types, uses and risks. It is educational, not investment advice.
The short version
- A stablecoin aims for 1 unit = 1 dollar (or euro), typically backed by reserves held by the issuer.
- Under MiCA, fiat-pegged stablecoins are regulated as e-money tokens (EMTs) with reserve and issuer-authorisation requirements.
- Stable does not mean risk-free: the peg depends on the issuer, and a stablecoin is not a bank deposit.
- Gains and losses on stablecoins can be taxable in Denmark — even when the price "just" tracks the dollar.
What is a stablecoin?
A stablecoin is a crypto asset designed to hold a steady value by tracking a reference — most often a fiat currency such as USD or EUR. Where Bitcoin moves freely, a stablecoin aims for 1 unit = 1 dollar (or euro).
The stability typically comes from reserves: the issuer holds assets (cash and short-term government bonds) matching the tokens issued. Examples include USDC (USD) and Aryze eEUR (EUR).
Types of stablecoin
- Fiat-backed — Each token is covered 1:1 by reserves in a currency — the most common and simplest model.
- Crypto-collateralised — Backed by other crypto assets with over-collateralisation — more complex and market-dependent.
- Algorithmic — Tries to hold the peg with code and incentives rather than full reserves — historically the riskiest type.
Under the EU’s MiCA, fiat-pegged stablecoins are regulated as "e-money tokens" (EMTs) with reserve and issuer-authorisation requirements. That is a meaningful difference from unregulated tokens.
What are stablecoins used for?
- Parking value — Between trades, without going back to a bank account.
- Fast transfers — Value moves on the blockchain in minutes, across borders.
- Price-stable settlement — A steady unit for trading and settlement when volatility is unwanted.
On Penning you can, for example, swap from a volatile asset into a stablecoin like USDC. See the supported assets if you want to know what’s available.
Risks: stable does not mean risk-free
A stablecoin is only as stable as the reserves and issuer behind it. The peg can, in rare cases, break, and a stablecoin is not a bank deposit — it is not covered by a deposit guarantee.
Check the issuer, not just the price
Look at who issues a stablecoin, whether the issuer is EU-authorised under MiCA, and whether reserve attestations are published. Also remember that gains and losses on stablecoins can be taxable in Denmark.
Frequently asked questions
This guide is educational and not investment advice. Stablecoins carry issuer and peg risk and are not covered by a deposit guarantee.
Swap into stability when you need it
Trade between volatile assets and regulated stablecoins like USDC on a MiCA-licensed platform — delivered to your own wallet.