Where your money sits on unflat, and who can move it

When you put money into an app that isn’t your bank, the first question isn’t what it earns. It’s where your money ends up if something goes wrong.

This post gives the honest answer: who holds your money on unflat, who can move it, what can go wrong, what is not covered, and what you can check yourself without asking us. If you don’t know unflat yet, start here and come back.

Is my money covered like a bank deposit?

No. unflat is a technology platform and is not a bank or a financial intermediary. Funds deposited through unflat are not covered by deposit guarantee schemes (FITD or equivalent) and are subject to risk, including loss of principal. Never deposit money you cannot afford to lose.

A bank deposit works differently. In a bank, your money is a claim on the bank. If the bank fails, the national deposit guarantee scheme, such as Italy’s FITD, pays the deposits back, within a limit of €100,000 per depositor per bank (the level set by EU law, in October 2026). Above that limit, you are one of the bank’s creditors. On unflat, there is no such scheme.

Is there a deposit guarantee for stablecoins lent in DeFi?

No. No public scheme pays back stablecoins lent in DeFi. Deposit guarantee schemes cover bank deposits, and a stablecoin is not a bank deposit. EU law gives something narrower: under MiCA, if you hold an e-money token such as USDC, you can get its face value back from the issuer. That right does not cover losses in a lending market.

USDC is issued in the EU by Circle, an electronic money institution authorised by France’s ACPR (Circle licenses). The right to get your money back at face value is set out in the EU supervisors’ consumer factsheet on MiCA (EBA, EIOPA and ESMA, October 2025). Money you move to Savings is lent through Morpho vaults: if a lending market takes a loss, no fund and no issuer pays it back. The same factsheet says that crypto-asset services outside MiCA, which include fully decentralised ones, can come with limited or no consumer protection, and the supervisors warned consumers about it in October 2025.

What is there instead of a guarantee?

There is no guarantee, so here are facts you can check. Your money stays in a wallet only you control, and every transaction needs your signature. Cover from OpenCover · Nexus Mutual is optional, off by default, and has limits. Sherlock reviewed the app’s code in July 2026. There is no lock-up, and there are no unflat fees.

Each point is explained below: who holds your money, who can move it, the cover and its limits, the audit and what you can check yourself. Third parties may charge: MoonPay and Coinbase for card and bank payments, shown before you confirm, and the vaults’ fees are deducted before the rate.

Who holds my money?

unflat never holds your money: it stays in a wallet only you control. unflat is non-custodial software, made by unflat S.r.l. in Milan. The wallet is built on Privy, and you sign in with email, Apple or Google. unflat can’t recover your wallet or access your money, and it can’t sign a transaction for you.

Your wallet is an account on Base, a public blockchain. Only a signature from your wallet can move what is in it. The app looks like a banking app, but the logic is the other way round: the money sits with you, not with the company that makes the app.

What happens to my money if unflat stops working?

Your money is not with unflat, so it would stay where it is: in your wallet, or in the Morpho vaults your Savings are lent through. You can export your recovery key in Settings › Security. Never share it: it gives full control of your money. Your money’s value still depends on USDC, the lending markets and the exchange rate.

Who can move my money?

Only you can move money in or out of your wallet: every transaction needs your signature, and unflat can’t sign for you. Inside each Morpho vault, third-party curators, today Steakhouse Financial and Gauntlet, adjust how the vault’s money is spread across lending markets, within limits set in the vault’s smart contracts.

Curators don’t act on your wallet: they manage the vault, and Morpho’s documentation describes what each role in a vault can do. Most changes to a vault’s risk settings take effect only after a waiting period, called a timelock.

Where does my money go in Savings?

Your Savings are held in USDC, a dollar stablecoin, and lent through Morpho vaults. Morpho is one of the largest DeFi lending markets (the largest is Aave). Borrowers pledge collateral worth more than the loan and pay interest: that interest is your yield. The rate is set by the lending market, not by unflat, and it is variable.

If the collateral loses value and falls below a set threshold, the smart contracts liquidate the position to repay the lenders, and here the lenders are you. Morpho’s core contracts are immutable: they can’t be changed after deployment. Morpho lists the audits of its contracts, including formal verification by Certora, in its documentation. For more on how the vaults work, read what Morpho Protocol is.

What can go wrong?

Your savings can lose value. The main risks are a bug in a smart contract, a loss in a lending market (bad debt), a wrong choice by a curator, USDC losing its peg to the dollar, and the exchange rate: Savings are held in USDC, so their value in euros moves with the euro-dollar rate.

• Smart contracts. Code can contain bugs, even after audits. Morpho lists this risk on its risk page.
• Bad debt. If collateral falls below the loan before the position is liquidated, the lenders take the loss. Price feeds (oracles) that fail or are manipulated can cause the same.
• Curators. Their choices of markets and limits decide where the vault lends. A wrong choice can cause losses.
• Liquidity. Morpho’s documentation notes that a lack of liquidity in a market can stop lenders from withdrawing from it for a while.
• USDC. USDC is designed to be worth 1 dollar, but a stablecoin can lose its peg. The EU’s financial supervisors warn that stablecoins may not stay stable, especially when markets are under stress (EBA, EIOPA and ESMA, October 2025).
• Exchange rate. Savings are held in USDC, so their value in euros moves with the exchange rate.
• The rate. It is variable and can go down.

Is there any cover?

Yes, optional. unflat offers on-chain cover from OpenCover · Nexus Mutual, off by default. Covered money earns a slightly lower rate. Cover is provided on a discretionary basis by Nexus Mutual, a member mutual, not as a regulated insurance contract. A 4% deductible applies. It does not cover a de-peg of USDC.

The app lists what’s covered and what’s not under “How coverage works”. A table of what the cover applies to is in Optional on-chain cover arrives on unflat.

The layers, one by one

The answers above rest on a few choices. Here is each one, with what it does and what it doesn’t.

The wallet: built on Privy

Your wallet is built on Privy, so you sign in with email, Apple or Google instead of writing down a 12 or 24 word recovery phrase. Privy’s documentation describes how the key is kept: it is split into encrypted shares, held in separate places, and no share alone gives access to the wallet. The full key is put together only for a moment, inside a secure enclave (a trusted execution environment), when you sign, and that needs your sign-in. No single file, server or person can open your wallet alone.

The way in: MoonPay and Coinbase

When you add euros by card or bank transfer, the payment and the conversion to USDC run through MoonPay or Coinbase. You can also send USDC to your unflat wallet on the Base network.

Both firms are authorised under MiCA, the EU regulation on crypto-assets: MoonPay Europe B.V. by the Dutch AFM since December 2024, and Coinbase Luxembourg S.A. by Luxembourg’s CSSF since June 2025. In October 2026, ESMA’s register shows that each authorisation covers the whole EU through passporting. For you, it means the way in goes through supervised firms, and card and bank payments start with a one-time identity check.

The app’s code: audited by Sherlock

Sherlock reviewed the app’s code in July 2026, in a collaborative audit. The review covered the unflat app, not the smart contracts of Morpho or of the vaults, which are audited separately. The report is not public. An audit looks for bugs; it can’t rule out every one, so it doesn’t change the risks above.

What you can check yourself

Here’s what you can check without asking us anything.

• Your money: open Basescan, the Base block explorer, and paste your unflat wallet address (the one the app gives you for USDC deposits). You see your balances and every transaction: deposits, yield and cover are public on the Base blockchain.
• Morpho: the risk page and the list of audits are public in Morpho’s documentation.
• Privy: how the key is split and used is described in Privy’s documentation.
• MoonPay and Coinbase: their MiCA authorisations are public in ESMA’s register. The EU’s supervisors advise checking there that a provider is authorised.
• The cover: the app lists what’s covered and what’s not under “How coverage works”, and Nexus Mutual’s documentation explains how the mutual works.
• Bank deposits: what a deposit guarantee scheme covers is on the site of your national scheme, such as the FITD in Italy.

In short

On unflat, each choice can be checked: a non-custodial wallet, Privy for sign-in, MoonPay and Coinbase as regulated entry points, Morpho for overcollateralised lending, optional on-chain cover, and an audit of the app’s code by Sherlock (July 2026). Check each point.