Stablecoins for Cross-Border Payments

A paper by PCMI assesses opportunities for stablecoins in cross-border payments ¹. Stablecoins are blockchain-based digital assets pegged to a fiat currency and around $210 billion worth are in circulation, the largest issuers being Tether (USDT) and Circle (USDC).

$6.3 trillion in stablecoin payments were settled in the 12 months to February 2025, equivalent to 15% of global retail cross- border payments in 2024.

Advantages for cross-border payments

As stablecoin use increases, so does their legitimacy, particularly for cross-border payments. Compared with traditional cross-border payment systems, they offer a number of benefits:

• Speed: transactions settle in seconds or minutes, compared to days in traditional banking.
• Cost efficiency: fees can be significantly less than traditional payment methods. Traditional cross-border transactions incur fees ranging from 1.5% to 6%. Using a mid-range fee of 3% for traditional systems and assuming that the fee rate could drop 40% to approximately 1.8% with stablecoins, adoption to stablecoin would save 1.2 percentage points per transaction.
• Transparency: blockchain-based ledgers provide a clear, auditable record of transactions, reducing fraud and enhancing compliance.
• Global accessibility: with only an internet connection required, stablecoins enable financial inclusion in regions with limited banking infrastructure.