Stablecoin remittances show no clear cost edge, Bank of Italy finds

A study by the Bank of Italy has challenged a widely held assumption about cryptocurrency: that stablecoin remittances offer a cheaper way to send money across borders, according to Cointelegraph. Researchers found that stablecoin remittances do not consistently provide a cost advantage compared to traditional methods, because most expenses come from currency conversion and payment infrastructure rather than blockchain fees.

This finding matters because stablecoins (digital currencies designed to maintain a fixed value, usually pegged to the US dollar or euro) have been promoted as a solution for remittance corridors, particularly in emerging markets where sending money home is expensive and slow.

Why stablecoin remittances costs tell a different story

When money moves across borders using stablecoin remittances, several costs stack up. The blockchain fee itself, which people often assume is the main saving, turns out to be minimal. The real expense comes earlier and later in the journey.

Converting fiat currency (regular money like dollars or euros) into a stablecoin in the first place carries a cost. This happens at an exchange or through a licensed stablecoin issuer. Then, at the receiving end, converting the stablecoin back into local currency creates another friction point. These conversion costs, the Bank of Italy found, account for most of the total price difference between different stablecoin remittances routes.

The payment infrastructure surrounding stablecoin remittances also drives expenses. A person sending money needs access to an exchange or wallet, and the receiver needs a way to convert digital assets back into cash they can actually use. Banks and payment networks that enable this conversion charge fees. These infrastructure costs exist regardless of whether blockchain technology is involved.

The implication is striking: stablecoin remittances do not beat traditional remittance methods simply by being on blockchain. They only win if the underlying financial infrastructure around them is genuinely cheaper or faster.

What this reveals about crypto’s real-world limits

The Bank of Italy study highlights a gap between promise and reality in cryptocurrency adoption. Blockchain technology excels at moving value quickly between two points with minimal transaction fees. But remittances involve much more than moving value: they involve currency conversion, regulatory compliance, and access to cash in the real world.

For stablecoin remittances to become genuinely cheaper than wire transfers or money-transfer services, the entire chain would need to be more efficient. This means either lower conversion costs (perhaps through competition between stablecoin issuers), better access to local banking infrastructure in receiving countries, or both.

Do stablecoins actually save money for people sending remittances?

Not automatically. The Bank of Italy research shows that stablecoin remittances cost varies widely depending on which exchange or payment provider you use, and how easily you can convert the stablecoin back into local currency at the destination. In corridors where traditional infrastructure is already efficient, stablecoins offer little advantage. In corridors where traditional options are expensive or slow, stablecoins might help, but only if someone has built cheap conversion infrastructure around them.

What this means for you

If you send money internationally or receive remittances, the takeaway is practical: do not assume stablecoin remittances are cheaper just because they use blockchain. Compare the total cost, including conversion fees and infrastructure charges, against traditional options like wire transfers or established money-transfer services.

• When evaluating stablecoin remittances for your situation, ask for the full breakdown of costs: conversion fees, infrastructure fees, and any exchange markups. Blockchain fees alone tell you almost nothing about the real price you will pay.
• Traditional remittance corridors with established infrastructure may still be cheaper than experimental stablecoin routes, even though they sound more old-fashioned. Competition and scale matter more than the underlying technology.
• The best option depends entirely on the specific corridor (country pair) you are using and which payment providers operate there. No single method works best everywhere.

For deeper analysis of how different remittance methods compare and how to evaluate blockchain solutions against traditional banking infrastructure, explore Thewealthora’s guides on international money transfers and cryptocurrency in everyday finance.

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Originally reported by Cointelegraph. Facts verified; analysis and wording are Thewealthora’s own.

Arpit Soni

The Thewealthora desk covers markets, money and personal finance, with zero jargon and every claim sourced.