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 reductions to a later time. The ECB has taken a diverging approach, bringing the deposit facility rate down to 2.5%. Currently, all euro-denominated savings accounts in Europe offer rates that closely track the ECB benchmark: N26 = 2.5% Wise = 2.24% Revolut = 1.74–2.49% Klarna = 2.20% Some of these savings accounts come with withdrawal constraints, such as fixed terms. I’m not listing traditional banks here since many offer similar rates, but it’s worth noting that most savings products benchmark below the market. That’s expected, as banks don’t heavily rely on retail deposits for day-to-day operations. EURC on Aave is currently hovering around 3.5%, presenting a notable premium compared to the ECB rate (and fintechs). If the ECB continues to lower yields (potentially down to 0–1.5%), we could find ourselves in a similar environment to 2019–2022 (including the COVID-era cuts), where DeFi yields stood out as attractive alternatives in a globally low-interest setting. EUR would likely be the first signal of this directional shift and European savings accounts will follow this rate decline. In many ways, DeFi may become a compelling source of yield for investors seeking alternatives, similar to how capital flowed into private lending, peer-to-peer platforms, and specialized funds during the last low-rate cycle. DeFi will offer the best algorithms and financial opportunities, distributed globally in a borderless fashion. Tokenization will accelerate this adoption by bringing more value into DeFi, e.g., Horizon introducing tokenized assets into Aave. Each asset will have a true lending and collateralization rate, generating yield accessible to anyone, anywhere. This is the recipe for Aave becoming the backbone of all finance.