It is a clear leg up over what Europe’s top fintechs and banks are offering.
With the ECB taking a different path from its U.S. and U.K., this DeFi yield stands out. EURC might be a sign of what’s ahead. It could be the canary in the coal mine for future rate shifts.
ECB Rate Cuts Put Pressure on Euro Savings Returns
While the Federal Reserve and the Bank of England are playing it safe—holding interest rates steady and delaying any cuts—the ECB has decided to press forward. Earlier this month, it lowered the deposit facility rate to 2.5%, signaling a shift toward looser monetary policy.
That’s a sharp contrast and could set the stage for another round of declining savings rates across Europe. Right now, most euro-based savings accounts are keeping pace with the ECB benchmark:
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N26 offers 2.5%.
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Wise is at 2.24%.
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Klarna clocks in at 2.20%.
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Revolut ranges from 1.74% to 2.49%.
The EURC yield on Aave’s Base market is an interesting development.
The ECB has taken the path of continuing with rate cuts, contrary to the Fed in the U.S. and the BoE in the UK, both of which have paused further cuts and maintained current rates, pushing any potential…
— Stani.eth (@StaniKulechov) April 14, 2025
But many of these options come with strings attached—like fixed withdrawal windows or limited access. And traditional banks? Often even stingier, as they don’t lean too heavily on retail deposits to keep the lights on.
DeFi Steps Up as ECB Cuts Rates and Yields Slide
If the ECB keeps trimming rates, potentially dipping into the 0–1.5% zone like during the COVID years, DeFi could once again step into the spotlight as a go-to source for yield. Back then, when yields everywhere hit rock bottom, capital poured into alternative markets—private lending, peer-to-peer platforms, and niche funds. This time around, DeFi might take center stage.
EUR yielding more on @aave than on Wise and Revolut. DeFi will win.
— Stani.eth (@StaniKulechov) April 11, 2025
Why? Because it’s borderless, permissionless, and always open for business. Projects like Horizon are already bringing tokenized assets into DeFi protocols like Aave, setting the stage for more real-world value to flow in. As each asset gains its own lending and collateral rate, investors can chase yield on their terms.
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