Stablecoin Remittances Face Reality Check in Banca d’Italia Study
The central bank poured cold water on the claim that stablecoin can make cross-border remittances cheaper.
A new study from Italy’s central bank challenges one of the crypto industry’s biggest selling points: that stablecoins can make cross-border remittances cheaper and faster than traditional payment networks.
Banca d’Italia’s research examined remittance corridors involving Italy, Argentina, Brazil, South Africa, the United Arab Emirates, and Japan, comparing USDC transfers against established money transfer services. Its conclusion was sobering.
Stablecoin transfers showed no systematic cost advantage, with total costs ranging between 0.3% and nearly 9%, meaning digital-dollar transfers were sometimes more expensive than conventional remittance providers.
Payment industry veterans addressed the findings, highlighting a critical distinction often overlooked in discussions about digital money: the difference between low-cost blockchain settlement and the expensive legacy networks surrounding it.
Size Matters in Remittance Costs
“The [central bank’s] test was fundamentally flawed,” said Daniela Sozzi, founder of London-based fintech strategy firm DNYC.
Why? Because of the relatively small transaction size used by the study’s authors ($200). In an email to Global Finance, Sozzi explained that the use of stablecoins is economically advantageous only for sums of at least $100,000. These are still relatively small compared to “traditional” wholesale transactions using traditional correspondent banking services, such as $1 million and above, she pointed out.
“So, stablecoins are cheaper for certain types of transactions, not universally cheaper,” said Sozzi.
But that $200 threshold isn’t arbitrary — it’s the standard transaction size the World Bank uses to benchmark its Remittance Prices Worldwide index, which put the global average cost of sending money through traditional channels at 6.36% in the third quarter of 2025.
The index of major international money-transfer operators, such as Western Union, came in at 5.52% — squarely inside the 0.3% to 9% range the Italian central bank found for stablecoins, underscoring Sozzi’s point that at this size, the two systems are comparable.
Still, Banca d’Italia’s findings track with a broader body of research on stablecoin remittances. A BIS paper published in March scrutinized how cross-border payments, “particularly remittances and retail transactions, remain more costly, slower, less accessible, and less transparent than domestic payments.”
Where Are Costs Coming From?
Rather than viewing the report as a rejection of digital money, payment industry experts say the findings point to a broader structural issue: while settlement on the blockchain is fast and cheap, moving money into and out of legacy networks remains costly.
These expensive friction points stem from legacy bank networks, explained Alexander Taskey, CEO of global settlements platform Frame.
“Much of the cost around stablecoins comes from on- and off-ramping, since that requires moving in and out of legacy payments infrastructure,” Taskey wrote in an email to Global Finance.
London-based Frame operates as a programmable settlement layer, enabling financial institutions to orchestrate and route funds across both legacy banking rails and on-chain networks.
“Once funds are on blockchain rails, the cost of transacting collapses to near zero,” Taskey added.
‘Blockchain Cost Isn’t the Issue’
Pankaj Bengani, founder and CEO of payments infrastructure company Meld, said that the friction lies at the edges. “The cost on the blockchain is not the issue. Once the fiat — whether it’s euro or U.S. dollar — is on the blockchain, the costs are very, very low. All the cost is baked into the on- and off-ramps.”
Because of this, both executives agree that judging stablecoins solely on current consumer remittance pricing misses the broader trajectory of payment rails.
Bengani likens today’s stablecoin ecosystem to the early days of global container shipping, where efficiency gains only materialized after shipping ports and logistics networks matured. Similarly, Frame’s Taskey said that end-user priorities will ultimately drive how these backend systems evolve.
“Ultimately, customers don’t care which rails are being used,” Taskey added. “They simply want payments that are cheaper, faster, and more secure.”
While consumer remittances in developed corridors like Europe and the U.S. remain highly optimized via traditional rails, stablecoins are finding immediate traction where traditional systems fall short — such as high-fee corridors or markets with volatile local currencies where businesses and consumers prefer holding USD balances.
The Future Is Hybrid
Looking five years ahead, industry leaders see stablecoins operating not as a total replacement for traditional banking, but as one part of a larger, hybrid settlement architecture.
“Five years from now, I expect stablecoins to coexist alongside legacy fiat rails as one option among many,” said Taskey. “The challenge for banks will be tying it all together and consolidating fragmentation into a single, interoperable platform.”
For now, the Banca d’Italia’s findings serve as a reminder that while blockchain technology offers near-frictionless settlement, the global financial infrastructure built around it still has significant ground to cover.
Anthony Noto covers corporate finance and private credit. Contact him at anoto@gfmag.com.
