Hungarian wax peppers have a thin, edible skin so it is unnecessary to peel them before adding to stews and salads as a colorful and spicy element. The seeds and membranes in chile peppers contain most of the capsaicin, the compound that lends them their mouth-searing qualities. Even though Hungarian wax peppers are not very hot, you can reduce the heat further by removing their seeds and veins. Hungarian wax peppers are often used in Hungarian soups and stews but are not usually found in Hungarian goulash, where paprika is the major spice. These peppers are also often pickled.