Key Highlights
- Banca d’Italia tested 200 USDC transfers across 10 remittance corridors connecting Italy with Argentina, Brazil, South Africa, the UAE, and Japan.
- Total transfer costs ranged from 0.30% to 8.96%, while the blockchain transaction itself represented only a small fraction of the overall expense.
- Stablecoins outperformed World Bank average remittance costs in several corridors but did not consistently beat Wise.
Italy’s central bank has challenged one of the crypto industry’s most common narratives, finding that stablecoins do not consistently offer cheaper or faster cross-border remittances than existing payment services.
In a new research paper titled “Are Stablecoins Efficient for Remittances? Evidence from a Mystery Shopping Exercise,” the bank evaluated real USDC transfers across 10 international payment corridors. Rather than relying on simulations, researchers executed actual transactions to measure the true cost and settlement time of stablecoin-based remittances.
The findings suggest that while blockchain transfers themselves remain inexpensive and relatively fast, the overall efficiency of stablecoin remittances is still largely determined by fiat conversion costs and the quality of local payment infrastructure.
How the Bank of Italy tested stablecoin remittances
To assess stablecoin remittances under real market conditions, researchers carried out 200 USDC transfers between Italy and five countries: Argentina, Brazil, South Africa, the United Arab Emirates, and Japan.
Italy served as the central hub, with transfers executed in both directions using major exchanges such as Binance and Kraken alongside regional platforms including Ripio, Foxbit, BitOasis, and Valr. All transactions were processed on the Ethereum blockchain during March 24 and 26, 2026.
Instead of measuring only the outcome, researchers divided every transaction into five stages: funding an exchange account, purchasing USDC, transferring funds on-chain, selling USDC, and withdrawing local currency. This allowed them to identify where both costs and delays actually occurred.
Why fiat conversion remained the biggest expense
One of the report’s clearest conclusions is that the blockchain itself was rarely responsible for high remittance costs. Across the 10 corridors, total transfer costs ranged from 0.30% to 8.96%, but the blockchain transfer represented only a small portion of that amount.
On average, on-chain settlement accounted for roughly 0.4% of the total transaction cost, while some routes, such as Brazil-to-Italy, recorded blockchain fees as low as 0.01%. Instead, the largest expenses were generated before and after the blockchain transaction, when users converted between local fiat currencies and USDC.
The report states, “The on-chain transfer itself was consistently the cheapest phase of the transaction, while the on-ramp and off-ramp stages accounted for the majority of total costs.”
The UAE-to-Italy corridor illustrates the issue clearly. Because users could only fund their exchange accounts via credit card, funding and purchase fees alone reached 6.17%, pushing the total transfer cost close to 9%.
Exchange rate distortions influenced Argentina results
Researchers also cautioned against interpreting Argentina’s exceptionally low remittance costs as evidence of stablecoin efficiency.
The Italy-to-Argentina route recorded the study’s lowest total cost at 0.30%, but Banca d’Italia said this largely reflected the gap between Argentina’s official exchange rate and its parallel market rate rather than any structural advantage provided by blockchain technology.
Those same market distortions worked against users sending money back to Italy, contributing to the 8.96% cost recorded on the reverse corridor.
How stablecoins compared with traditional remittance services
The study also compared USDC transfers with both World Bank average remittance costs and Wise, one of the world’s largest money transfer providers.
Compared with World Bank averages, stablecoin transfers generally performed well.
For example:
- Brazil’s average remittance cost stood at 9.96%, compared with 2.21% for the USDC route.
- South Africa averaged 15.23%, while the stablecoin transfer cost 5.44%.
The UAE was the exception, where the World Bank’s average remittance cost of 2.65% remained significantly lower than the 8.95% recorded during the USDC transfer.
Against Wise, however, the results were more mixed. Stablecoins proved cheaper in only three of the eight comparable corridors, while Wise offered lower costs across the remaining routes, including transfers involving Argentina and the UAE. The findings suggest that stablecoins do not yet offer a consistent pricing advantage over established remittance providers.
Local payment networks determined transfer speed
Although blockchain confirmation typically took less than 15 minutes, overall remittance speed depended largely on domestic banking infrastructure. Countries with instant payment systems, including Italy, Brazil, and Argentina, completed end-to-end transfers in under 20 minutes.
In contrast, transfers involving South Africa, where conventional bank transfers remain the primary payment method, required one to two business days, eliminating much of blockchain’s speed advantage.
Japan presented a different challenge. The study notes that local regulations restricted retail users to a single domestic provider and required an unhosted wallet during the transaction process. While costs remained relatively low, researchers said the workflow would likely be too complex for ordinary users.
Payment infrastructure matters more than Blockchain
Based on the findings, the bank concluded that stablecoins should not automatically be viewed as a cheaper alternative for international remittances. Instead, their competitiveness depends on the specific payment corridor, exchange pricing, funding methods, and the quality of local financial infrastructure.
Rather than focusing on further improvements to blockchain settlement, the study argued that expanding domestic instant payment systems and reducing fiat conversion costs would have a greater impact on lowering remittance expenses.
The study also warns that overly restrictive regulatory environments such as those observed in Japan could unintentionally push users toward offshore exchanges or decentralized finance platforms instead of reducing demand for stablecoin-based transfers.
Also Read: More GOP Senators Question Stablecoin Yield in CLARITY Act
