Finextra reports on a new Bank for International Settlements working paper comparing cross-border payment costs across traditional banks, fintech money transfer operators (MTOs), and stablecoin-based transfers.
Researchers found retail bank wires carry FX markups of roughly 2% to 4.7% even for liquid currency pairs, before explicit wire fees. Fintech MTO costs are materially lower and fall as a share of transfer size; for 40–$60, though some corridors remain expensive.
Stablecoins fare worse in the study: converting between fiat and stablecoins requires exchange intermediaries with trading, conversion, and withdrawal fees. Recipients may wait for on-chain settlement and bank processing. Liquidity between USD stablecoins and non-USD currencies is thin; any FX advantage in some emerging markets reflects capital-control distortions rather than blockchain efficiency. Limited depth and volatile pricing constrain scale.
The authors conclude stablecoin competitiveness depends on liquidity, fiat access, regulatory compliance, and intermediary trust—not technology alone.