Western Europe’s crypto economy reached $2.08 trillion between July 2025 and June 2026, according to Chainalysis, making it the world’s second-largest regional market. The total was up 1.2% over the period, a modest gain that stood out against a broader market downturn.
Activity remained concentrated in a handful of countries. Chainalysis said roughly two-thirds of the region’s total came from six markets: the UK with $424.5 billion, Germany with $288.8 billion, France with $215.8 billion, the Netherlands with $207.8 billion, Spain with $156.1 billion, and Switzerland with $132.8 billion. While Spain and Switzerland expanded, the UK, still the region’s largest market, shrank 8%.
Growth held up as the EU outpaced the UK
The report describes a market that kept growing even as conditions remained difficult. Across the European Union, crypto activity rose 2.2% during the same period, while the rest of Western Europe excluding the UK grew 3.8%. That contrasted with the UK’s decline, creating a split between the region’s biggest national market and much of the surrounding bloc.
Chainalysis said MiCA contributed to this divergence. The firm said the rollout of the EU’s crypto framework may have constrained growth at first, but later supported a more integrated market by enabling firms to use passporting rights across the bloc. That, in turn, may have helped sustain expansion during a broader bear market.
Stablecoins took a larger role across the region
Stablecoins were one of the clearest areas of growth. Holdings in personal wallets across Western Europe climbed 131%, far faster than the 52% global increase cited by Chainalysis. As a result, the region’s share of worldwide stablecoin balances rose from 3.4% to 5.1%.
The pattern was not uniform. The UK led Western Europe in domestic stablecoin transfers, with wallet-to-wallet activity reaching $2.09 billion in 2026, compared with $1.41 billion for the rest of Western Europe combined. Chainalysis also found that 1.03% of eligible UK retail wallets converted at least 80% of their holdings into stablecoins in 2026, the highest rate among the six major markets it examined.
France showed a different shift, with stronger movement toward self-custody. Chainalysis said self-custodied stablecoin balances in France rose 192% during the period, while withdrawals from centralized exchanges accounted for 54.2% of French service withdrawals by 2026, the highest share among the region’s major markets.
Euro trading and bond markets moved together
Chainalysis also pointed to closer links between crypto behavior and traditional financial markets. Euro-denominated trading increased as the euro gained ground in crypto markets, including in Bitcoin and tokenized gold.
According to the report, euro-area government bond yields rose relative to US yields during the period, and euro crypto trading tended to rise when those yields increased and fall when they declined. Chainalysis said this pattern suggests some traders may be using crypto to diversify or hedge amid concerns around sovereign debt and fiscal outlooks, particularly in France.
Cross-border flows and prediction markets added new signals
Spain emerged as a notable destination for activity from elsewhere in Europe. Chainalysis said exchanges registered in Spain attracted more inflows from other European countries than from Spain itself, with average cross-border inflows to those platforms rising by about 198% in 2026. Italy and Portugal were identified as important sources, pointing to the broader regional reach of European exchanges.
The report also highlighted activity in prediction markets. In Europe, wallets allocated a larger share of volume to negative outcomes in US-Iran markets, according to Chainalysis, suggesting crypto is being used as a venue for geopolitical betting. The firm added that returns on those negative positions were weaker than on the other side of the trade.
What Chainalysis says comes next
Chainalysis argues that Western Europe is becoming a larger and more integrated crypto market rather than simply a collection of separate national markets. In its view, rising stablecoin use, stronger cross-border flows, a bigger role for the euro, and the effects of MiCA are reshaping how activity is distributed across the region.
The next confirmed direction in the report is not a forecast of prices or volumes, but a structural one: regulatory clarity and deeper connections to traditional finance are likely to play a central role in the region’s future crypto development.
Source: www.chainalysis.com