Stablecoins in 2026: what they are and how they’re changing European savings

The stablecoin market was worth about $314 billion in October 2026, more than ten times its size at the end of 2020, yet many European savers still file stablecoins under “crypto, not for me”. This guide explains what they are, how they hold their value, what changed in 2026 and which risks to know.

Date	Stablecoin market
End of 2020	$27 billion
End of 2021	$163 billion
End of 2022	$138 billion
End of 2023	$131 billion
End of 2024	$206 billion
End of 2025	$308 billion
8 October 2026	$314 billion

Source: DefiLlama, October 2026.

What is a stablecoin?

A stablecoin is a digital token that tracks a traditional currency, such as the US dollar or the euro, and lives on a public blockchain like Ethereum. It is designed to keep a one-to-one value with that currency: 1 USDC is designed to be worth 1 dollar, 1 EURC to be worth 1 euro.

Three things to keep in mind:

1. A stablecoin is not Bitcoin. It is not designed to rise in value. It is designed not to move.
2. A stablecoin is not a bank transfer. It moves on a blockchain, 24/7, without going through SWIFT.
3. A stablecoin is not a current account. It is a tool, not a guaranteed deposit.

How do stablecoins hold their value?

The main stablecoins hold their value with reserves: for every token in circulation, the issuer keeps the same amount in cash and short-dated government debt, publishes what it holds and redeems tokens one to one. The quality of those reserves, and how often they are checked, is what separates one stablecoin from another.

Take USDC, the dollar stablecoin issued by Circle: about $74 billion was in circulation on 5 October 2026. At the end of August 2026, when $73.3 billion of USDC was in circulation, its reserves were made up like this:

Reserve asset	Amount	Share
Overnight repurchase agreements backed by US Treasuries	$49.6 billion	68%
US Treasury bills maturing within three months	$13.2 billion	18%
Cash at regulated banks and in the reserve fund	$10.6 billion	14%
Total reserves	$73.4 billion	100%

Source: Circle, USDC Reserve Report, August 2026.

Most of the reserves sit in the Circle Reserve Fund, an SEC-registered money market fund managed by BlackRock. Circle publishes the holdings every week on its transparency page, and every month a Big Four accounting firm checks that the reserves are worth more than the USDC in circulation. You can read each of these reports yourself.

How is a stablecoin different from Bitcoin or a bank account?

They solve different problems. Bitcoin is a volatile investment that can rise or fall sharply. A bank account is stable and its deposits are covered by a guarantee scheme, but in 2026 it pays less than inflation. A stablecoin is stable against the currency it tracks and can earn a variable yield, with risks of a different kind.

Bitcoin is a volatile investment

Bitcoin’s price can move 20% in a week. It suits people with a long horizon who can accept deep falls. It does not replace a current account, and it is not a stablecoin.

A current account is stable, and its deposits are covered

In Italy, the FITD covers bank deposits for €100,000 per depositor per bank, and every EU country has an equivalent scheme. The trade-off is the rate. In August 2026, overnight household deposits in the euro area paid 0.29% on average, and new deposits with an agreed maturity 2.18% (European Central Bank). Inflation in the euro area was 3.8% in September 2026 (Eurostat). In real terms, money left on a current account loses purchasing power.

Stablecoins can earn a yield, with different risks

Lent on decentralised lending markets such as Morpho, USDC earns a variable yield, set by how much borrowers want to borrow. This is the mechanism unflat uses behind the scenes: money in unflat Savings has earned about 5% a year so far in 2026, variable. That is the average annual percentage yield of unflat Savings (USDC) without cover, from 1 January to September 2026; the lending market sets the rate, not unflat, and past rates do not predict future ones.

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.

These risks are different from the risks of a bank: they are listed below.

Why is 2026 a turning point for stablecoins?

Three changes came together. MiCA, the EU’s crypto-asset regulation, now applies in full across the EU. Circle, the issuer of USDC and EURC, has been a listed US company since June 2025. And stablecoins have become payment infrastructure, used by card networks and the makers of payment terminals.

MiCA applies in full, and it helps savers

MiCA (Markets in Crypto-Assets) sets one framework for stablecoins across the EU. Its stablecoin rules have applied since 30 June 2024 and the rest since 30 December 2024. The transitional period for crypto-asset service providers that were already working under national rules ended on 1 July 2026 at the latest.

For savers, this is a structural change. Issuers must hold reserves and redeem tokens at par, client assets must be kept apart from the provider’s, and one authorisation is valid across the EU. That raises the bar and leaves less room for the disorderly failures seen in 2022. Circle has issued USDC and EURC under MiCA since July 2024.

Circle is a listed company

Circle has been listed on the New York Stock Exchange (ticker CRCL) since June 2025, so the issuer of the world’s second-largest stablecoin publishes its accounts as a US public company.

Stablecoins are part of the payment system

In July 2025, Visa added EURC to its stablecoin settlement. In January 2026, Ingenico announced stablecoin payments, EURC included, on millions of its payment terminals through WalletConnect Pay.

Why does the euro matter?

Most stablecoins are in dollars, so a European saver who holds them is exposed to the EUR/USD exchange rate. In October 2026, more than 99% of the stablecoin market was in dollars. Euro stablecoins exist but are still small, and the largest is EURC, the euro stablecoin issued by Circle.

EURC had €422.4 million in circulation on 5 October 2026, more than half of all euro stablecoins according to DefiLlama.

unflat’s savings are held in USDC today, so a euro saver’s balance moves with the EUR/USD exchange rate. More on that in why we use USDC, and where EURC fits.

How can you use stablecoins for your savings?

With unflat it takes four steps: add money by card or bank transfer, or send USDC; move it to Savings; your money is lent on Morpho and earns a variable yield every second; and you withdraw whenever you want. There is no lock-up, and unflat never holds your money.

1. You add money by card or bank transfer through MoonPay or Coinbase, or send USDC on Base if you already hold some.
2. You move it to Savings.
3. Your savings are lent through Morpho vaults run by third-party curators, today Steakhouse Financial and Gauntlet. Morpho is one of the largest DeFi lending markets (the largest is Aave), with more than $16 billion in deposits in October 2026.
4. You withdraw whenever you want.

unflat is non-custodial: your money stays in a wallet only you control, and you can check where it is on-chain. You can export your recovery key in Settings › Security.

The story behind the project is in what unflat is and how it works.

What are the real risks before you start?

There are three: a bug in the lending protocol’s code, a stablecoin losing its peg, and losses in the lending market after extreme price moves. None of them is zero. Funds in unflat are not covered by deposit guarantee schemes, and the optional on-chain cover does not cover a USDC de-peg.

Smart contract risk. The lending protocol’s code could contain bugs. Morpho publishes more than 30 security audits of its code, which lowers the risk but does not remove it.

Depeg risk. A stablecoin can lose its peg for a while. In March 2023, when Silicon Valley Bank failed with $3.3 billion of USDC reserves inside, USDC fell to about 87 cents before recovering in the following days (CoinDesk). MiCA reduces this risk but does not remove it.

Protocol risk. DeFi lending is overcollateralised: the borrower pledges collateral worth more than the loan. Extreme price moves can still leave losses.

Conclusion

Stablecoins are already part of today’s financial system: dollars and euros on a blockchain, not speculative crypto. With a European framework that applies in full and reserves you can check, they are a concrete way to think about savings, next to traditional tools, not instead of them. Knowing their risks is the condition for using them knowingly.