Prepared by Alexandra Born, Johanne Evrard, Dimitris Georgarakos, Geoff Kenny, Claudia Lambert, Justus Meyer, Trixi Pairan and Luca Zannier
The expanding stablecoin market, its increasing interlinkages with the financial sector and growing consumer holdings could affect financial stability in the euro area. The global stablecoin market has grown rapidly since 2020 but has recently plateaued (Chart A, panel a). At the same time, stablecoins have become increasingly interlinked with the traditional financial sector, particularly through reserve asset holdings.[1] While the euro-denominated stablecoin market has grown, it remains relatively small (Chart A, panel b). Stablecoins are mainly used for crypto trading, although they could potentially also serve as cross-border payment instruments. This box uses unique household-level evidence from a topical module of the ECB�s Consumer Expectations Survey (CES), carried out in August and November 2025, to assess the extent and composition of euro area consumers� stablecoin holdings.[2] Current exposures in the euro area appear limited, but the concentration of holdings among crypto investors and the prominence of US dollar-backed tokens could amplify shocks. Wider stablecoin use in the euro area, especially outside the crypto ecosystem, could increase the risks to traditional finance over time.[3]
Evolution of the global stablecoin market
The use of stablecoins to facilitate transactions in the crypto ecosystem may carry a risk for consumers, as it could affect the traditional financial system.[4] Stablecoins enable the trading and exchange of fiat currencies for non-stablecoin crypto-assets and vice versa.[5] The reserve assets that back stablecoins link them to the traditional financial system, which can potentially lead to spillover effects.[6] Stablecoins may also enable low-cost cross-border payments, which could be an option for consumers sending money outside the euro area, though evidence on this use case is mixed.[7]
Euro area consumers are slowly increasing their direct exposure to crypto-assets, from low levels.[8] The share of consumers owning crypto-assets increased from 9.8% in November 2024 to 13% in August 2025 (Chart B, panel a), a period in which crypto markets and stablecoins were growing rapidly (Chart A). The 2025 CES results distinguish stablecoin holdings within consumer crypto-asset exposures: in August 5% of consumers reported holding stablecoins, which was over a third of all consumers that held crypto-assets. The estimated distribution of stablecoin holdings in terms of amounts invested is skewed towards smaller amounts (Chart B, panel b). However, close to 10% of stablecoin owners are estimated to have had holdings of �10,000 or more in November, pointing to a substantial range.
Consumer holdings of crypto-assets
Dollar-denominated stablecoins dominate euro area consumer exposure, as consumers tend to hold the crypto-assets with the largest market capitalisation. Around 63% of consumers with a crypto exposure hold bitcoin, followed by ether (36%) and XRP (22%) (Chart C, panel a). Among stablecoins, USDT is the most widely held (17% of consumers with crypto holdings), ahead of USDC (12%) and the euro-denominated EURC (10%). Other euro-denominated and non-euro-denominated stablecoins combined account for less than 9% of reported holdings. Although the survey does not directly report how assets are used, preliminary evidence shows higher usage among respondents born either in another EU country or outside the EU. Foreign-born respondents were found to be 2.1 percentage points more likely to hold stablecoins than domestic consumers after taking into account other characteristics. This pattern is consistent with the possibility that stablecoins are being used for cross-border payments or remittances.
Composition of consumer crypto-asset investments
The use of stablecoins as transactional assets could have broader implications for financial stability if adoption continues to grow. Stablecoins account for a small share of consumers� financial assets and are mostly held alongside other crypto-assets. This is consistent with their main use as transactional assets within the crypto-asset ecosystem (Chart C). While the relatively low usage of stablecoins in the euro area limits immediate risks to bank funding, it points to three vulnerabilities for the future if stablecoins were to become significantly more widely used: (i) exposure to runs on stablecoins and �de-pegging� events, when stablecoins deviate significantly from their par value; (ii) potential spillovers from a liquidation of US dollar stablecoin reserves; and (iii) a possible currency substitution channel. If the use of dollar-denominated stablecoins by euro area consumers begins to extend beyond crypto-asset transactions, their holdings of non-euro stablecoins could grow. Depending on the scale of adoption, this could affect deposit funding, monetary transmission and the role of euro-denominated payment instruments.[9] Given the importance of stablecoins in the crypto ecosystem, a large shock to a stablecoin (e.g. a de-pegging event) could be detrimental.[10] As most stablecoin holders also own other crypto-assets, their wider portfolio would be affected. Conversely, an adverse shock to crypto-asset prices could trigger a stablecoin sell-off, potentially de-pegging stablecoins and causing additional wealth effects. The dual holdings suggest that stablecoin usage acts as a two-way channel between crypto-assets and investor wealth. Shocks may also harm investors� trust in stablecoins, further contributing to crypto market instability.[11] Volatile crypto-asset valuations may pose a risk to investor confidence through stablecoins.
The CES data suggest that while current holdings pose limited risks to euro area financial stability, this could change if stablecoin adoption were to broaden significantly. As the market continues to develop, euro area consumers may increasingly hold private, non-bank and non-euro stablecoins � especially as younger, more crypto-inclined cohorts enter these markets. While spillover risks from cross-border regulatory arbitrage may persist, the EU has implemented a robust regulatory framework through the Markets in Crypto-Assets Regulation which reduces many of the risks discussed. Monitoring consumer exposures and contagion channels remains essential to support consumer confidence and limit risks to consumer wealth.
References
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