How are stablecoins used in cross-border payments?

Why is sending money abroad still expensive?

Moving money between countries often passes through several banks, each holding accounts with the next, each converting currency and checking compliance. Every hop adds a fee, a spread or a delay. The World Bank's Remittance Prices Worldwide survey tracks the result: in the third quarter of 2025, sending the equivalent of $200 cost 6.36% on average worldwide. Digital services averaged 4.59%, non-digital ones 7.30%, and banks were the most expensive type of provider.

Governments have set a goal. United Nations Sustainable Development Goal 10.c aims to cut remittance costs below 3% by 2030 and remove corridors costing more than 5%. The G20 also runs a program, launched in 2020, to improve cross-border payments, and the BIS payments committee has studied stablecoins as part of it. Domestic alternatives such as instant payment systems and central bank digital currencies are others.

How does a stablecoin payment move across a border?

A cross-border stablecoin payment is really three transactions joined together. The token moves on the blockchain, but both people still live in a world of local bank accounts.

1. On-ramp. The sender buys a dollar stablecoin with local currency at an exchange or payment app, paying a fee or spread and passing identity checks.

2. Transfer. The tokens move between wallet addresses on a blockchain, usually in minutes, for a network fee (a gas fee).

3. Off-ramp. The recipient sells the tokens for local currency at an exchange or agent, paying another fee or spread, and withdraws to a bank or mobile wallet.

Ordinary users rarely deal with the issuer. Circle, for instance, offers direct one-for-one redemption only to businesses such as exchanges and banks, so individuals rely on the prices those intermediaries offer at each end.

Is a stablecoin transfer cheaper than a remittance service?

Sometimes, but it depends on the ends of the chain, not the middle. The Bank for International Settlements acknowledged in 2025 that stablecoins can offer lower costs and faster speed, especially across borders. Real costs, though, depend on the platforms and countries involved, and the World Bank's price survey does not cover stablecoin routes, so there is no official benchmark to compare against.

To compare offers you receive, our FX fee calculator shows how fees and exchange-rate margins add up.

What do central banks and regulators worry about?

Public bodies see the appeal and the risks. The BIS's 2025 Annual Economic Report describes stablecoins as digital bearer instruments that can circulate freely across borders, notes weaknesses in identity checks, and argues they fall short as money on three tests: singleness (always worth par), elasticity and integrity. It also notes that over 99% of stablecoins are dollar-denominated, which can erode other countries' control over their own money — sometimes called stealth dollarization.

The IMF's 2025 paper Understanding Stablecoins makes a similar point: stablecoins may add to currency substitution and volatile capital flows, especially where inflation is high or institutions are weak. The BIS Committee on Payments and Market Infrastructures concluded in 2023 that no stablecoin arrangement it had seen was yet properly designed, regulated and fully compliant for cross-border use, and urged "same business, same risks, same regulatory outcome".

Financial crime is the other concern. The Financial Action Task Force reported in July 2026 that most identified on-chain illicit activity now involves stablecoins, and that 83% of surveyed jurisdictions had passed laws for its Travel Rule, which makes crypto firms pass sender and recipient details along with transfers. Expect identity checks at both ends, as explained in KYC and AML explained.

What mistakes do people make sending stablecoins abroad?

• Counting only the network fee. The on-ramp and off-ramp, including their exchange-rate spreads, can cost far more than the transfer itself.
• Choosing the wrong network. The recipient's exchange must support the same blockchain and token; otherwise funds can be lost.
• Ignoring local law. Some countries restrict buying or selling crypto-assets, or tax them; check before you send.
• Using unlicensed peer-to-peer sellers. They may offer better rates but bring fraud and frozen-account risk.
• Leaving the recipient exposed. Someone holding tokens until a better rate appears takes on platform and depeg risk; see how stablecoins keep their peg.