The Blockchain Was Never the Expensive Part

Somebody at the Bank of Italy actually did the thing.

Not a model. Not a survey of providers’ published rates. Four researchers opened accounts on real exchanges, funded them with real money, bought 200 USDC, sent it across ten international corridors, sold it on the other side, and withdrew the proceeds to a real bank account. Then they added up what was missing.

The results, published on 30 July as Paper No. 86 in Banca d’Italia’s Markets, Infrastructures and Payment Systems series, are the first mystery-shopping exercise on stablecoin remittances run by a major central bank. They deserve to be read carefully by everyone building in this space, including us.

The headline finding is uncomfortable if you sell stablecoin remittances on price alone. Total end-to-end costs ranged from 0.30% to nearly 9% of the amount sent. Stablecoins showed, in the authors’ words, “no systematic cost advantage over traditional channels.”

The second finding is the one that matters, and it points somewhere else entirely.

Where the money actually goes

The researchers broke each transfer into five phases: fund the exchange with local currency, buy USDC, move it on-chain, sell it for local currency, withdraw to a bank account.

The on-chain leg, the part the entire industry markets, was the cheapest component in every single corridor. It averaged 0.4% of the amount transferred, and on the Brazil-to-Italy route it came in at 0.01%.

Everything else was the cost. Exchange trading fees. Deposit and withdrawal charges. Foreign exchange spreads. The two ends of the journey, not the middle.

The worst corridor in the study (UAE to Italy, at roughly 9%) was expensive for a mundane reason. The only funding method available to the sender at the time was a credit card, carrying a 3.8% surcharge. That is not a blockchain problem. That is a banking-access problem wearing a blockchain costume.

And the picture is not uniformly bad. Measured against Wise, one of the most efficient money transfer operators in the world, USDC came out cheaper on three of the corridors tested: Italy to Argentina, Italy to South Africa, and Brazil to Italy. On Brazil to Italy the gap was clean : 2.21% for USDC against 4.68% to 4.89% for Wise. On the South Africa leg, USDC landed at 5.44% against a World Bank average of 15.23% for that corridor. Five percent is not cheap. Against fifteen, it changes what a family can do with the money.

That is the real shape of the result. Not “stablecoins don’t work.” Rather: stablecoins work where the last mile has been solved, and struggle exactly where it hasn’t.

Speed tells the same story

Settlement times split along the same fault line. In Italy, Brazil and Argentina, all of which run domestic instant payment systems, the full five-step journey completed in under 20 minutes. Brazil’s PIX settles in roughly three seconds on average.

In South Africa, where the funding and withdrawal steps ran over standard bank transfers, the same journey took one to two business days. The speed advantage stablecoins are famous for did not exist in that corridor at all. The tokens moved in seconds. The money did not.

Japan couldn’t be assessed on comparable terms. Local rules restrict retail USDC access to a single domestic operator, which doesn’t permit direct outbound transfers to foreign exchanges. The researchers had to route through an unhosted wallet, a workflow the paper describes as incompatible with ordinary retail use.

The conclusion the authors reach is that stablecoins and domestic instant payment systems are complements, not substitutes. The chain isn’t competing with PIX or UPI. It’s the connective tissue between them.

Regulation is a cost line

A week after the paper landed, Brazil’s central bank published Resolution BCB No. 584/2026. From 1 January 2027, exchanges must hold customer transfers to foreign platforms and self-custody wallets for up to 24 hours where the amount exceeds roughly $10,000 in a single day, or where the exchange’s own risk review flags a smaller transaction. The stated aim is to stop fraud proceeds leaving the country before victims or institutions can recover them, which is a legitimate goal and a real problem.

It is also, in the vocabulary of the Italian study, a change to the off-ramp. And the off-ramp is where the cost and the time live.

The Banca d’Italia authors make this point without hedging: regulatory design is a primary determinant of whether stablecoin transfers are practical and affordable for ordinary people. Restrictive frameworks raise costs, thin out the operator pool, and push users offshore. Outright prohibitions redirect demand into unregulated channels without reducing it. Japan is the version of that already visible in the data. Brazil is the one worth watching next.

What this means for how we build

We’ve written before that stablecoins change three things for remittances: cost, speed and predictability. This study sharpens that considerably, and we’d rather absorb it than argue with it.

The lesson is that nobody should be sold a remittance product on the price of a blockchain transaction. Families sending money home are not buying block space. They are moving value from one account, wallet or cash-out point to another, usually across two currencies, and the only honest measure is what arrives at the other end and when.

It is also worth being precise about who this study measured. To run a mystery-shopping exercise like this one you need a bank account, a smartphone, exchange accounts in two countries, a card or transfer method to fund them, and enough confidence with the interface to buy a token, send it to an address and sell it again on the other side. That is a real population, and for that population the finding looks right: the rails are broadly comparable, and choosing between USDC and Wise is an argument over a few percentage points.

It is not the population that loses the most. The World Bank’s Global Findex 2025 puts account ownership at 79% of adults globally, and finds that 84% of adults in low- and middle-income economies own a mobile phone, with three billion of them owning a smartphone. The distance between those numbers is where remittances are still genuinely expensive. A phone, but not a smart one. A family member abroad, but no account of your own. None of the digital fluency the Banca d’Italia researchers could take for granted. Those households pay agent margins at a counter, in cash, and no amount of cheap block space reaches them.

That gap is what Koin Remit exists to close, and it is why our work sits at the ramps rather than the rail. On-chain settlement has been close to free for a while now; treating it as the differentiator is a category error. What actually changes the number a family receives is local and unglamorous, real payout partners, direct integration with domestic instant payment systems where they exist, transparent FX, licensing that lets us operate inside the regulatory perimeter rather than routing around it, and reaching people on the devices they already own rather than the ones we wish they had. Our partnership with HMD and Polygon is aimed squarely at that last point: stablecoin payments that work on a feature phone as well as on a smartphone. And when Koin Remit went live on Android for receivers in India earlier this month, the part that mattered wasn’t the chain. It was that the money lands in a familiar account, in rupees, without the recipient needing to know what a wallet is.

The paper ends on the point we think is the actual horizon: the largest efficiency gain would come if recipients could spend stablecoins directly in the local economy, removing the conversion step entirely. That day isn’t here in most markets. Until it is, the off-ramp is the product.

The global average cost of sending $200 is still 6.36%, against a UN Sustainable Development Goal target of 3% by 2030. A central bank finding that stablecoin rails currently land somewhere between 0.3% and 9% isn’t a verdict against the technology. It’s a map of where the remaining work is.

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