Stablecoin Remittances Fail to Deliver Cost Savings

The Bank of Italy has released a report analyzing the use of stablecoins for cross-border remittances. The report found that while on-chain transfer fees were low, averaging just 0.4%, the total cost to users was often higher than traditional services.

The primary expenses in stablecoin remittances occur during the conversion from cryptocurrency to fiat money. Bank account deposit fees, foreign exchange spreads, and cash withdrawal charges imposed by exchanges and financial intermediaries can erode or even eliminate the initial savings from low blockchain transaction costs.

In a direct comparison with Wise, a leading traditional remittance provider, stablecoins were cheaper in only three of the ten corridors examined by the Bank of Italy. The report challenges the narrative that stablecoins can bypass traditional banking systems entirely, as cash-out processes inherently rely on banks and regulated exchanges, which reintroduce conventional fees and delays.