Stablecoins (ART / EMT)
Algorithmic Stablecoin
A stablecoin maintaining peg through algorithmic supply adjustment rather than reserves — restricted under MiCA.
Definition
An algorithmic stablecoin maintains its peg through algorithmic supply expansion and contraction rather than asset reserves. MiCA effectively excludes purely-algorithmic stablecoins from the ART/EMT regimes by requiring reserves. The collapse of Terra/UST in 2022 informs MiCA's reserve requirements.