Stablecoin remittances fall short in Italy study
The idea that stablecoins make cross-border remittances cheaper has faced scrutiny. A study by Italy’s central bank found no consistent cost advantage when comparing USDC transfers to traditional money-transfer services across corridors involving Italy, Argentina, Brazil, South Africa, the United Arab Emirates, and Japan.
Costs for stablecoin remittances varied from 0.3% to nearly 9%, occasionally surpassing fees charged by established providers. These results question whether digital currencies can reliably undercut legacy payment networks on price and speed.
The study’s methodology received criticism from payment industry experts. Daniela Sozzi, founder of London-based fintech strategy firm DNYC, described the test as flawed because it used a $200 transaction size. While this amount aligns with the World Bank’s Remittance Prices Worldwide index, it fails to show stablecoins’ benefits at larger scales.
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Sozzi stated stablecoins become cost-effective only for sums of at least $100,000. The World Bank’s latest index placed the global average cost of traditional remittances at 6.36%, with major operators averaging 5.52%—a range similar to what the Italian study found for stablecoins.
Earlier research had already moderated expectations. A March report from the Bank for International Settlements observed that cross-border payments, particularly remittances, remain more expensive, slower, and less accessible than domestic transfers. The problem lies not in the technology but in the surrounding infrastructure.
Blockchain settlement itself is inexpensive once funds are on-chain. The challenge arises when moving money into and out of traditional banking systems. Alexander Taskey, CEO of global settlements platform Frame, explained that most stablecoin costs stem from on- and off-ramps, where funds transition between legacy and blockchain systems.
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Taskey noted that once funds are on blockchain rails, transaction costs drop to nearly zero. Pankaj Bengani, CEO of payments infrastructure company Meld, agreed, saying the blockchain itself isn’t the issue—all expenses come from the on- and off-ramps.
The Banca d’Italia study doesn’t reject stablecoins outright. It reveals a gap between the promise of seamless settlement and the reality of a financial system still built on outdated infrastructure. For now, the technology’s benefits remain inconsistent and far from widespread.
