A study by the Bank of Italy has concluded that stablecoin-based remittances do not provide a systematic cost or speed advantage compared to traditional payment channels, with fiat on- and off-ramp frictions responsible for the majority of transfer costs and delays.

The findings speak to a question at the center of cross-border payments policy: the G20 has prioritized enhancing cross-border payments as a multilateral objective, and the United Nations Sustainable Development Goals include a target to reduce remittance costs to below 3% by 2030. Remittances remain a critical financial lifeline globally, with the World Bank estimating flows to low- and middle-income countries alone at approximately $685 billion in 2024.

Researchers conducted 200 USDC (USDC) test remittances across 10 bidirectional payment corridors connecting Italy to Brazil, Argentina, Japan, the United Arab Emirates, and South Africa. The end-to-end costs and settlement times were then compared against established remittance services. Exchange fees and currency conversion costs accounted for the bulk of expenses, while blockchain transaction fees represented only a marginal portion.

Total costs across the stablecoin remittance corridors examined ranged from 0.3% to nearly 9%. Where instant payment systems were available, transfers settled in under 20 minutes; where they were not, settlement took one to two business days.

Benchmarked against the World Bank's reported global average remittance cost of 6.65%, stablecoin transfers were found to be cheaper in most corridors tested. However, when compared directly with Wise, stablecoin transfers were less expensive in only three of seven comparable corridors.

Payment Infrastructure a Decisive Factor

The study determined that settlement times depended heavily on the quality of local payment rails, concluding that investment in domestic instant payment infrastructure could meaningfully improve the competitiveness of stablecoin-based cross-border payments. The finding aligns with a broader pattern documented by the Bank for International Settlements, which has identified fragmented and legacy domestic payment systems as a key bottleneck in cross-border payment efficiency — a constraint that blockchain technology alone cannot resolve where local rails remain underdeveloped.

The authors argued that the greatest economic benefits would materialize only when stablecoins can be used without conversion back to fiat currency:

If stablecoins could be spent directly in the real economy, for goods and services, rents, or school fees, without reconversion into local fiat currency, the economic advantages of stablecoin-based transfers would be substantially higher.

Regulatory Design Influences Efficiency

Regulatory design was also found to play a significant role in remittance efficiency. The authors noted that prohibitionist regulatory regimes did not fully suppress stablecoin demand but instead drove users toward offshore platforms and other unregulated channels. Conversely, overly restrictive frameworks increased operational complexity for retail users.

The findings arrive as the European Union has implemented its Markets in Crypto-Assets (MiCA) framework and the United States has enacted the GENIUS Act — two regulatory regimes governing crypto assets and payment stablecoins, respectively. How these frameworks influence on- and off-ramp liquidity, stablecoin issuance costs, and merchant acceptance in everyday commerce will be closely watched by payments providers and financial institutions operating across major remittance corridors.

According to DefiLlama data, the stablecoin market has grown to approximately $307 billion, representing an increase of roughly 16% over the past year.

The full study is available in the Bank of Italy's Markets, Infrastructures and Payment Systems series (No. 86).